Recap - May 19
Meeting summary for LiveEdge Mentoring May (05/19/2025)
Quick recap
Shawn discussed market trends and trading strategies, emphasizing the challenges of shorting an extended market and sharing insights on various indices and companies like Tesla. He provided analysis of recent market movements and trading opportunities, while encouraging traders to engage with his content and learn from recent examples. Shawn stressed the importance of risk management and proper strategy execution, advising traders to avoid overextending and focus on long-term profitability through effective risk management.
Next steps
Traders to be cautious about shorting in the current market conditions due to strong upward momentum.
Traders to wait for clear setups and avoid chasing trades, especially after missing initial moves.
Traders to manage risk by using appropriate stop losses and position sizing.
Traders to focus on consistent strategy implementation rather than changing strategies frequently.
Traders to accept that losses are part of trading and avoid revenge trading or overtrading on losing days.
Dan to message the trading desk to set up a hotkey for placing stop losses after entering a position.
Traders to practice using the new stop loss hotkey on demo accounts before implementing in live trading.
Traders to consider taking a break from trading after experiencing multiple losses in a session.
Summary
Market Trends and Trading Insights
Shawn discussed market trends and shared insights on trading strategies, emphasizing the challenges of shorting an extended market. He highlighted a recent example where the market reversed after a short video was released, illustrating the difficulty of predicting immediate market movements. Shawn encouraged traders to subscribe to the YouTube channel and engage with weekend videos to improve algorithmic reach. He also mentioned plans to delve deeper into context analysis and methodology in future sessions.
Market Caution and Trade Strategy
Shawn discussed the market's recent behavior, noting a gap down followed by a recovery attempt. He expressed caution about shorting the market due to its strong structure and the alignment of ES and NQ futures. Shawn suggested waiting for a clear breakdown or a dip to buy before taking any significant trades. He also mentioned a free membership deal available for the month and encouraged potential members to check it out.
Market Trends and Trading Insights
Shawn discussed market trends, focusing on ES and NQ indices, and analyzed Tesla's performance, noting potential opportunities for traders. He emphasized the importance of understanding market context to avoid overtrading and financial losses. Shawn also shared insights on market structures and trading strategies, encouraging participants to learn from recent examples. He concluded by asking for feedback on content format and inviting questions from the audience.
Market Support Levels and Breakout Analysis
Shawn discussed the market's unexpected sell-off without any apparent news, noting that it dropped to a key support level of 5,900 before bouncing back. He emphasized the importance of waiting for a clear break of the current 15-point range and highlighted the potential for the market to retest either 5,850 or 5,800 if it breaks below 5,910. Shawn also observed that NQ had broken out pre-market and was retesting its May 14-15 lows, while ES was in the middle of its respective range, suggesting possible rejection levels.
Nasdaq Futures Trading Strategy
Shawn discusses trading strategies for the Nasdaq futures (NQ) in the first 30 minutes of the trading session. He initially looks for a short opportunity but stops out twice. The market then moves upward, testing and breaking through Friday's range. Shawn decides not to chase the upward trend, preferring to wait for a potential failure or pullback. He notes the strong bullish momentum with multiple green candles and no significant pullbacks. Towards the end, Shawn takes a risky front-side short trade on an extension, expecting it to fail, but acknowledges the trade's high risk.
Market Short Strategy Adjustment
Shawn discussed a trading strategy involving shorting the market below a specific price level of 59.55, with a 5-point risk. He monitored the market's movement, considering entry points and potential exits, but expressed doubt about the success of the trade. Shawn eventually decided to reduce his position and maintain only his initial entry at 59.60.
Risk Management in Trading
Shawn discussed the importance of managing risk and not overextending in trading, emphasizing that traders should accept losses as part of the game and focus on winning most of the time. He analyzed the market's behavior, noting a parabolic extension move without a pullback, and explained that being right but early can lead to losses due to execution delays. Shawn advised traders to stick to their strategy, manage risk effectively, and avoid chasing new strategies or forcing trades, highlighting that good risk management is crucial for long-term profitability.