Sweet spots
Every market has a sweet sport. Odds that will be reached more often than others, a score.
This also applies to trading. Depending on how you chose to enter and exit, there is a sweet spot in terms of when it’s best to trade in and out.
When I model a market I’m looking for sweet spots. Optimal places where it makes ‘sense’ to open, close to trade to in a market. At first you can’t do this going forward because you don’t have any clues or a model. So you should start by analysing a match and working backwards. What worked? Why? From there you will get clues and patterns as to what is causing the sweet spot to appear. Once you get an understanding of that you can start project forward.
Of course the thing you can’t tell is exactly what will happen in the underlying event. But once something gets underway the the range of paths that lead to the sweet spot will narrow and that guides you as to whether it makes sense to do something or not.
In the Men’s final at Wimbledon today, I’ve already plotted out all the paths that could lead to a variety of sweet sports. As the match progresses I’ll know if the match is converging on them and whether it’s worth a try getting in or out at the current price and score. Sometimes it never does, but I’d rather do nothing than jump into a market at an irrational point.
I’ve rounded the values to make it easier to read, but in the first set tomorrow 1.65 can be reached in a number of ways, much more frequently than other scores. But that’s no shock as that’s more or less the SP. In the second set I would hunt 1.30, 1.15, 1.70 & 1.10. Set three, 1.10, 1.25, 1.20, 1.75 and then smaller frequencies from there. Set four 1.25,1.05, 1.80.
I’ve shown a few videos where I am looking for key scores and there likely effect on price using Tennis Trader so you should be able to do this. Of course there are a lot of variations in Tennis, and things can change as the match gets underway; but by mapping out a few paths you can guide yourself to areas that are more likely to pay off.
Good luck if you are on the final today!
Category: Tennis, Trading strategies
