How to Easily Measure Relative Volatility on All Four Index Markets
In tonight’s video, we do a side-by-side comparison of all four of the indices – ES, NQ, YM and RTY – to show you how to easily identify and rank the volatility in each market.
Each index market’s activity after the market opened at 6:30am PT helped us to build a profile, and understand which of the indices was more volatile compared to the rest.
Having this information 30 minutes within the market open helped inform us where to focus for trading opportunities.
We also discuss some more potential trade setups using the Volatility Box, which give us more ways to participate in the market outside of just fades.
With the S&P today, the trade setup called for risking 4 points to try and make 4 points, with a second target of ~7.75 points.
With the NQ today, the same trade setup called for risking 15 points to try and make 15 points, but a second target of ~27 points.
Understanding relative volatility between the markets helps us to easily identify where we might find “better” entries, that offer us an exceptional risk-reward ratio, while maintaining our system-driven probabilities.