Day Trading the E-mini Futures

[TheNegotiator 13]

Okay, so much like the "Reading Charts in Real Time" thread, this thread will be for sharing ideas about future price moves of all the e-mini index futures.

 

Any styles or strategies are welcome, but please do your best to share the thinking behind them!

 

So to get us rolling, I have an idea to put to you. Below is a chart of the ES. Take a look before reading on. My idea is a sell on a failure to hold 1320. Volatility has increased over the past few days and frequently this is seen at extremes of markets. It is also in a triangle formation with lower highs and higher lows. So far it has resisted attempts to close in the minor 3 day balance highlighted. A close in or below this balance could see at the very least, a liquidating selloff. My entry idea would be either to sell a retest of the minor balance high around 1334 if we test and fail to break the prior balance high(red line) at 1320. Or if we fail at the balance high at 1320, fade any move back towards it.

 

Any thoughts?

[emg 12]

Okay, so much like the "Reading Charts in Real Time" thread, this thread will be for sharing ideas about future price moves of all the e-mini index futures.

 

Any styles or strategies are welcome, but please do your best to share the thinking behind them!

 

So to get us rolling, I have an idea to put to you. Below is a chart of the ES. Take a look before reading on. My idea is a sell on a failure to hold 1320. Volatility has increased over the past few days and frequently this is seen at extremes of markets. It is also in a triangle formation with lower highs and higher lows. So far it has resisted attempts to close in the minor 3 day balance highlighted. A close in or below this balance could see at the very least, a liquidating selloff. My entry idea would be either to sell a retest of the minor balance high around 1334 if we test and fail to break the prior balance high(red line) at 1320. Or if we fail at the balance high at 1320, fade any move back towards it.

 

Any thoughts?

 

will not work. don't know how to explain it.

[TheNegotiator 13]

Emg, if you want to post in this thread you'll have to at least attempt to explain your thinking more than you do in your thread "Emini S&P 500 Day Trading Journal".

[TheNegotiator 13]

This chart was some more structure backing up the idea of a minimum of a short term correction down. I remain open to ideas though and I'm trying to not talk myself into the trade! Any charts you can post to identify a more bullish skew on the ES would be welcome!

[emg 12]

This chart was some more structure backing up the idea of a minimum of a short term correction down. I remain open to ideas though and I'm trying to not talk myself into the trade! Any charts you can post to identify a more bullish skew on the ES would be welcome!

 

channel trading will not work. need to create your own indicator where as nobody use and never heard or seen of

[TheNegotiator 13]

channel trading will not work. need to create your own indicator where as nobody use and never heard or seen of

 

If you have no way of backing yourself up and nothing to add, you will be prevented from posting here. By all means disagree and back yourself up. However, this is a forum for ideas.

 

I suggest to anyone who is interested, take a look at emg's thread

 

http://www.traderslaboratory.com/forums/3/emini-s-p-500-day-trading-7705-86.html

[TheNegotiator 13]

The IB low/38.2% session retracement look to have held for now so I'm shorting 1319.75 but will monitor closely for signs of strength. Needs to push on fairly quickly though.

[TheNegotiator 13]

I got stopped out for a loss at 1321.00. I had hoped to ride it if there was some momentum but I guess not. We'll see what happens if we get a daily close below the 1319.25.

[johnw 10]

will not work. don't know how to explain it.

 

Emg, if you want to post in this thread you'll have to at least attempt to explain your thinking more than you do in your thread "Emini S&P 500 Day Trading Journal".

 

Hi Neg,

 

I think that emg has explained exactly where he is coming from.

[sdoma 10]

Good morning traders!

 

Anyway, you can see that price is gradually being pressed into your support. Swing highs are lower, and lower, and lower. If price can break through and hold beneath your support, I could see it going to 1295 in the near term. It all depends on how long you want to hold the trade.

 

So, how do you plan to play this?

 

Also, this is hindsight, since I didn't have time to post it this morning, but the scenario I envisioned worked out nicely. Before the start of opening trading, I envision what I believe are the two or three most likely scenarios. My first scenario today was the Dow breaking support and auctioning down to the top of the unfilled gap, at 12359. That level also happens to be the 100% fib projection, so we have some nice confluence there.

 

This wasn't that easy to play, though. It looks simple here on the 405 min, but when we zoom down to the intraday data, you can see how there were a lot of fakeouts for a day trader. I put some numbers on the second chart. Match them up to these bullets.

 

1. This was when it seemed that my play would be fairly straightforward. We opened, auctioned up to the support from the larger chart, and immediately failed.

 

2. As you can see, however, it was not straightforward. Price made a low, then began to chop back up. This is when being a day player is nice, you can preserve some profit.

 

3. Market chops back up to support, tests, fails, tests again and fails, and auctions back towards the low. This is where it started to get tough. I was short, expecting at least a test of support, which it didn't quite give me.

 

4. Price accumulated and then broke out to the upside. At this point I began to turn bullish and looked to a gap fill. I played the retest of support and got chopped around a bit in the process. Market filled half the gap, at which point I noticed major amounts of selling in the order flow. Sellers came in in increasing numbers, absorbing the mo mo buying and gradually beating back the assault.

 

5. As prices began to turn back down, I was somewhat hesitant to jump back in short, but did so anyway with a trailing stop.

 

6. The market began to accelerate as it moved down, breaking that support yet again and auctioning to the low.

 

7. At that point, no significant buyers stepped in and the sellers pounded price through the lows. I didn't hold all the way to 12359, but I got most of it.

 

I'm not posting this to brag. I made money, but not as much as I could have or perhaps even should have because of the fakeouts and choppiness of the move. However, because I knew this was a distinct possibility for the day's action, I was able to keep my head through the chop, switch sides when it looked like I was wrong so I didn't get pounded too badly, and eventually have a nice payday.

 

I hope this helps some of the new people out there. This is what trading is. You have to be light on your feet. Creating a good plan is easy, as is making decent market calls. Trading those beliefs profitably is an entirely different story.

[emg 12]

Good morning traders!

 

Anyway, you can see that price is gradually being pressed into your support. Swing highs are lower, and lower, and lower. If price can break through and hold beneath your support, I could see it going to 1295 in the near term. It all depends on how long you want to hold the trade.

 

So, how do you plan to play this?

 

Also, this is hindsight, since I didn't have time to post it this morning, but the scenario I envisioned worked out nicely. Before the start of opening trading, I envision what I believe are the two or three most likely scenarios. My first scenario today was the Dow breaking support and auctioning down to the top of the unfilled gap, at 12359. That level also happens to be the 100% fib projection, so we have some nice confluence there.

 

This wasn't that easy to play, though. It looks simple here on the 405 min, but when we zoom down to the intraday data, you can see how there were a lot of fakeouts for a day trader. I put some numbers on the second chart. Match them up to these bullets.

 

1. This was when it seemed that my play would be fairly straightforward. We opened, auctioned up to the support from the larger chart, and immediately failed.

 

2. As you can see, however, it was not straightforward. Price made a low, then began to chop back up. This is when being a day player is nice, you can preserve some profit.

 

3. Market chops back up to support, tests, fails, tests again and fails, and auctions back towards the low. This is where it started to get tough. I was short, expecting at least a test of support, which it didn't quite give me.

 

4. Price accumulated and then broke out to the upside. At this point I began to turn bullish and looked to a gap fill. I played the retest of support and got chopped around a bit in the process. Market filled half the gap, at which point I noticed major amounts of selling in the order flow. Sellers came in in increasing numbers, absorbing the mo mo buying and gradually beating back the assault.

 

5. As prices began to turn back down, I was somewhat hesitant to jump back in short, but did so anyway with a trailing stop.

 

6. The market began to accelerate as it moved down, breaking that support yet again and auctioning to the low.

 

7. At that point, no significant buyers stepped in and the sellers pounded price through the lows. I didn't hold all the way to 12359, but I got most of it.

 

I'm not posting this to brag. I made money, but not as much as I could have or perhaps even should have because of the fakeouts and choppiness of the move. However, because I knew this was a distinct possibility for the day's action, I was able to keep my head through the chop, switch sides when it looked like I was wrong so I didn't get pounded too badly, and eventually have a nice payday.

 

I hope this helps some of the new people out there. This is what trading is. You have to be light on your feet. Creating a good plan is easy, as is making decent market calls. Trading those beliefs profitably is an entirely different story.

 

gap trading does not work. many uses gap and still losing

[emg 12]

If you have no way of backing yourself up and nothing to add, you will be prevented from posting here. By all means disagree and back yourself up. However, this is a forum for ideas.

 

I suggest to anyone who is interested, take a look at emg's thread and the lack of detail or substantiation of any trade.

 

http://www.traderslaboratory.com/forums/3/emini-s-p-500-day-trading-7705-86.html

 

ban me if u want to. My opinion and comments have value. I posted my comment and you deleted them, That post have value.

 

Good luck in your trading

[TheNegotiator 13]

Well substantiated sdoma. Pity about it being post the event! I actually made some decent money when it became clear the market was not accelerating lower and ran a trade from the ES opening price (1322) back into yesterday's range. Pity about the short later on but it really doesn't matter too much. I'm not really a multiday position trader but I wanted get the thread started as I think it could be a really beneficial one for many to see reasoning then how the market plays out.

 

emg your posts are about as useful as a chocolate teapot.

[Tams 20]

"ignore" is taking its effect.

Edited May 17, 2011 by Tams

[TheNegotiator 13]

Well clearly that particular trade didn't work. But hey, you can't win them all and the nature of the business is to look for trades which you believe have high risk:reward ratios. That particular trade had it worked, could've been very profitable. I hope more traders want to discuss their trading ideas here.

[sdoma 10]

Right now, we are at an interesting point in the Dow. It has been channeling down for a few weeks, but today it challenged the upper end of the range and closed not too far away from it. Tomorrow, that trend line point is at approximately 12,600, and yesterday's high is 12,616. There is a decent probability that the market will test that price zone, at which point I will be waiting for it to be rejected or accepted.

 

I am hoping for a decent move either way. If price is rejected, I think yesterday's lows are a good initial target, followed by the midpoint of the channel, 12513 and 12445 respectively. Unless it really gets randy, I would be looking to be out at one of those price points.

 

If we see a breakout to the upside, I would make use of my SUPER SECRET PROPRIETARY volatility targets (only $4,000 a month and worth every penny!). You also have a zone of 12666 - 12681 where I could see price probing.

 

Of course, a third, and dreaded, scenario is a choppy inside type day. At that point, toss up bollinger bands or keltner channels and start fading.

[TheNegotiator 13]

Sounds like a good plan if it gets there. Not a whole heap out today so it will be important to try to gauge activity early to see if it's going to be quiet or not. If it is, there could well be a late break in either direction.

[TheNegotiator 13]

Looks like that would have been a great trade there sdoma. I did suspect that there was a decent chance that the european session test of that area might have been the one and only chance today to get short there. Still, one or two nice opportunities in these markets so far today. I know it's after the event now, but there was an especially nice little short in ES when it broke out of yesterday's range, then failed to get back into it on the first test. It was also the 38.2% session retracement. Same thing in YM by the looks of things.

[sdoma 10]

Looks like that would have been a great trade there sdoma.

 

Yes, would have been, but I got taken away from the computer due to a personal matter until about 9:15 central, at which point the down move was finished. I spent the rest of the day getting chopped up and trapped in this ridiculous rally.

[TheNegotiator 13]

Hmm. How far were you hoping YM sold off to? Didn't it get to the places where you said you would be closing your short?

[sdoma 10]

Hmm. How far were you hoping YM sold off to? Didn't it get to the places where you said you would be closing your short?

 

If price is rejected, I think yesterday's lows are a good initial target, followed by the midpoint of the channel, 12513 and 12445 respectively.

 

First target was met, second target was within 15 ticks. The problem is that I have been looking for an apartment and that has been taking me away from the computer at various points in the day. Not being able to sit there for the whole session has wreaked havoc on my trading. I find myself rushing into trades, or missing them and then overtrading out of frustration. Here's a chart of the day's action:

[sdoma 10]

Interestingly enough, the dow is well below Friday's low, and is trading 12406 as I write this. If this weakness continues, the low of May 17, 12350, should be a solid target, and if prices can successfully auction lower, perhaps a test of the channel bottom at 12280 is in the cards. If the market rejects lower prices, auctioning into Friday's range is obviously what I'd look for. A more precise target could be Fridays VPOC, 12500, and perhaps a value sweep to 12542 if the sellers get caught with their pants down.

[Tams 20]

Interestingly enough, the dow is well below Friday's low, and is trading 12406 as I write this. If this weakness continues, the low of May 17, 12350, should be a solid target, and if prices can successfully auction lower, perhaps a test of the channel bottom at 12280 is in the cards. If the market rejects lower prices, auctioning into Friday's range is obviously what I'd look for. A more precise target could be Fridays VPOC, 12500, and perhaps a value sweep to 12542 if the sellers get caught with their pants down.

 

May I ask, why do you think the low of May 17, 12350 should be a solid target?

[TheNegotiator 13]

ES has some important tests to make depending on where it opens today. 1316.00 low from 17th May then down to the current overnight low at 1312.25 which is also an area for me. A failure to hold 1316 and I'll sell if the price action convinces me. Would then look to the overnight low. An open above the 1316 and failed test could see a push back towards the 1327 area which was also Friday's low. (whether you like gap closes or not;))

[sdoma 10]

May I ask, why do you think the low of May 17, 12350 should be a solid target?

 

That target has, unfortunately, already been hit in the overnight market. It is trading 12349 as I write this, 8:15 am CST.

 

But, my rationale was a simple one, and was made on the contingency that we didn't rally hard overnight. That low is a somewhat significant swing point. It is also the top of a gap that has remained unfilled for some time now. On the 17th, the market tested that gap and reversed hard, on good volume.

 

One of the core beliefs that drives my trading is that markets attempt to probe what traders consider significant price levels to see what business there is to be done there. If you can identify levels that draw the attention of the whole market, you can use them as targets with a decent hit rate. What happens when price gets there, of course is a much trickier thing to read.

 

But to update my plan, for today I'm not as certain now. We've created a large gap, and the bottom of the channel is not so far away, but we could do anything from here. I just need to go with the flow, trade my levels and not get too attached to anything until the market tips its hand, if it does at all.