A Few More Insights From The Futures Trading Summit

The second day of the Futures Trading Summit featured some well-known speakers, who shared their trading strategies. One of the best aspects of the Summit was the opportunity to interact with the speakers and attendees. Because none of the sessions were concurrent, everyone attended the same meetings and had plenty of opportunity to see each other. It was also refreshing to have a conference in which attendees were not bombarded with sales pitches. Here are just a few notes I jotted down:

* Andy Bushak. professional trader: When you have an oscillator make a strong high, pull back, and then make another, weaker high, that divergence represents waves 3 and 5 in a five-wave Elliott pattern. Look for correction.

* Jim Dalton, author of Mind Over Markets and the forthcoming Markets in Profile: Volume is crucial: How you get from point A to point B is all-important. The important question for the trader is whether price is attracting activity. If not, you'll have reversal back to value; if so, you'll have a trend.

* Sheldon Natenberg, options expert and author: When volatility is low, buy protective puts for insurance. When volatility is high, sell covered calls. A good options trader is willing to take a lot of small losses in order to hit an occasional home run.

* John Carter, trader and principal of Trade The Markets: Market internals (TICK, TRIN, Put/Call Ratio) will tell you as early as possible during the day whether it is likely to be an uptrending day, downtrending day, or choppy day. Ignore short trade setups in a strong market and vice versa. Watch for extremes in sentiment measures such as TICK and put/call ratio: the market will turn around and trap people at those extremes.

Some of the presenters have written excellent books. Jim Dalton, Sheldon Natenberg, and John Carter come to mind immediately. Yra Harris was featured in the book House of Money by Drobny, which is an interesting profile of hedge fund traders. For traders interested in tracking their performance, a new version of Trader DNA is being rolled out and looks very user friendly. I'll be testing it out and reporting on it here.