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Why I like to use STOPS & Support & Resistance Levels 7.12.2018


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Today's market actions on a few different levels lead me to writing this and sharing a few thoughts aboutwhy I personally believe a trader should use stops.*
A couple of events took place today:

The firstwere thelarge moves in the energy sector including the very popular crude oil contract.
Crude oil had a range of $4.24 from high to low. That translates to $4240 ofaloss if you were unlucky to buy the high and sell the low.....Not sure why the CME overnight margin for this market is still ONLY $3200 but if you traded futures before you can see where I am going with this. You could have had enough margin to carry long position overnight and find yourself in deficit if you (or the risk manager/your broker) did not take you out of the position in time.
The other meaningful event was that the CME had connection issuesacross many FCM's, and routing connections which lead to a situation where certain traders were not able to get out of a position via their trading software (I am proud to say that the majority of our clients had the ability to call us and get help via phone). Its not a good feeling to say the least, to feel that you are "stuck" in the market. However, in this specific case, if you had stops already working on the exchange, you at least had that level of protection.
The moral of the story? Learn to use stops each time you trade. You can get away 9 times (luck, deep pockets etc.) but all it takes is that one time where either your trading capital or luck runs out to destroy your trading account.
As always, we are here to assist and answer anyquestions via email, phone or chat!Call us @ 310-859-9572


*Note about stops:THEPLACEMENT OF CONTINGENT ORDERS BY YOU ORYOUR TRADING ADVISOR, SUCH AS A ''STOP-LOSS''OR ''STOP-LIMIT'' ORDER, WILL NOT NECESSARILY LIMITYOUR LOSSES TO THE INTENDED AMOUNTS, SINCE MARKETCONDITIONS MAY MAKE IT IMPOSSIBLE TO EXECUTE SUCHORDERS.

Futures Trading Levels

07-12-2018


SP500 #ES_F

Aug. Crude Oil #CL-F

August Gold #GC_F

2808.42

77.39

1267.7

2798.08

75.83

1262.5

2786.42

73.15

1252.5

2776.08

71.59

1247.3

2764.42

68.91

1237.3

2754.08

67.35

1232.1

2742.42

64.67

1222.1


For a complete list of support and resistance levels for#ES_F,#NQ_F,#YM_F,#RTY_F,#XBT_F,#GC_F,#SI-F,#CL-F, #ZB_F, #6E_F,#ZC_F,#ZW_F,#ZS_F,#ZM_F,#NG_Fhttps://www.cannontrading.com

Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. You may lose all or more of your initial investment. Opinions, market data, and recommendations are subject to change at any time.



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About the author


Ilan Levy-Mayer has been a commodities broker for over 15 years, and holds an MBA in Finance and Marketing from Hebrew University in Jerusalem. Ilan is currently the Vice President and a Senior Broker at Cannon Trading Company . He is also a CTA of Levex Capital Management and his daily blog was voted the #1 Futures Blog from Trader's Planet.

His experience in the industry dates from the beginning of online trading, and he has also developed several trading systems over the years. In addition, Ilan has written several articles about trading methods and trading psychology, and has been quoted and published several times in SFO magazine, Futures, and Bloomberg. He has been invited to speak at the Chicago Board of Trade, a significant distinction.

Ilan specializes in analyzing the markets based on timing methods, proprietary technical indicators, using support and resistance levels and looking at multiple time frames.

Take a step in the right direction and contact me today, Toll-Free: 800-454-9572 or direct: +310-859-9572. You may also directly e-mail me, Send mail.

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Disclaimer: This is not a solicitation of any order to buy or sell, but a current market view provided by Cannon Trading Inc. Any statement of facts here in contained are derived from sources believed to be reliable, but are not guaranteed as to accuracy, nor they purport to be complete. No responsibility is assumed with respect to any such statement or with respect to any expression of opinion herein contained. Readers are urged to exercise their own judgement in trading. 

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