Day Trading the E-mini Futures

[steve46 12]

Here is the last post for the day

 

What we have is a basing pattern....followed by two (2) counters which are reversal patterns...and this is why, when you have a system that works, you TAKE THE TRADES

 

I have referenced this time of day before in previous posts...for me this is the time when price often moves in a range and we play "ping-pong"...today was a good example.

Edited November 22, 2011 by steve46

[TheNegotiator 13]

Pre-Thanksgiving market today and it looks quite possible this market is due for a stuffing(cough). Bad jokes aside, Mon/Tues balanced and opening looks like it'll be below that range by a decent enough amount. I'd say failure to get build back in that range and who would bet against seeing that ol' 1157.50 area again? Any takers?

 

The one caveat is that it is just before TG and so we could also end up seeing nothing, or because of that reason the move could be accentuated. We'll just have to see.

 

[TheNegotiator 13]

Nice move down there I thought. Hope a few of you caught the train! For now it looks to be over, but could well push further later on. We'll have to see.

 

[TheNegotiator 13]

I didn't trade it (because it takes too long to post an image!!) but sometimes after a directional move like the one we have seen, I do look for any reaction at the first move back to 38.2% fibonacci. Especially when it ties in with something else. The 38.2% ret cam in at VWAP and a volume area at 1168.75.

 

[TheNegotiator 13]

Btw I just noticed that the chart to the right with the long term profile happens to have the peak volume looking like it's coming in at the low of 1164.00 on the left chart. It doesn't, it's just poorly aligned! It comes in at 1157.50. Just make sure you look at the separate price scales for the two different charts.

[TheNegotiator 13]

********************************NOTICE***********************************

********************************NOTICE***********************************

********************************NOTICE***********************************

 

Just so everyone knows, any trade you take is entirely your responsibility alone. Any ideas posted here by any user are just their ideas and are meant for thought and discussion only. They are not trading suggestions or recommendations.

 

Thank you.

[steve46 12]

Hmmm...okay....then onward and upward as they say

 

This is in response to the questions about defining a distribution....as mentioned previously, there are several methods that work. One (shown here) is to wait for price to test and retest a price point on each "end" of a range....Today I chose the short side....I assume the rationale is obvious....

[TheNegotiator 13]

Well it pretty much got to the 1157.50 in the end - just 1pt shy. Nice demonstration of how the market 'targets' certain objectives especially when it's out of balance. I hope everyone did well.

 

Happy Thanksgiving to all (and to those who aren't in US, happy days off because of US holiday!! )

[joshdance 10]

Nice move down there I thought. Hope a few of you caught the train! For now it looks to be over, but could well push further later on. We'll have to see.

 

 

N, in your chart here you say that you saw volume enter the market based on the profile. Also, as you are using a volume chart I assume you can see the bars forming more quickly.

 

Have you also used time based bars with a volume histogram? As the market pushed lower a few minutes later before the nice reversal up, I was watching a 500V chart to see inside the 1m bars, but the volume was clear to see on the 1m chart with the volume histogram. I missed a buy limit fill by 1 tick based on what I saw here FWIW.

 

So, on your profile you see the volume build. Then what? It did push up above the newly formed POC, which to me would seem bullish. I was asleep at the time you took your chart screen shot (or just waking up), due to some holiday hour changes for me, so I did not see the market at the time of your shot, and also I do not have IRT on my mobile computer so did not have access to the forming profile.

 

Also, if I may ask, what was your trigger for the entry at 72? It did pull back to the developing POC, which was around 72--was the fact that it was going lower, and pulled back there, a determining factor?

Edited November 24, 2011 by joshdance

[cfrn 10]

There were a lot of ways to Sell '72 this is just one of them.

 

Direction + Momentum + Trend + Cycle + Price Action = Decent Trade

 

[TheNegotiator 13]

N, in your chart here you say that you saw volume enter the market based on the profile. Also, as you are using a volume chart I assume you can see the bars forming more quickly.

 

Have you also used time based bars with a volume histogram? As the market pushed lower a few minutes later before the nice reversal up, I was watching a 500V chart to see inside the 1m bars, but the volume was clear to see on the 1m chart with the volume histogram. I missed a buy limit fill by 1 tick based on what I saw here FWIW.

 

So, on your profile you see the volume build. Then what? It did push up above the newly formed POC, which to me would seem bullish. I was asleep at the time you took your chart screen shot (or just waking up), due to some holiday hour changes for me, so I did not see the market at the time of your shot, and also I do not have IRT on my mobile computer so did not have access to the forming profile.

 

Also, if I may ask, what was your trigger for the entry at 72? It did pull back to the developing POC, which was around 72--was the fact that it was going lower, and pulled back there, a determining factor?

 

I tend not to look too much at a volume histogram on a short timeframe. At point of entry, the price action can happen within seconds and so even a 1min histogram masks the speed of the trades coming in. I prefer to watch the DOM/T&S and a profile to see if there is a build of vol. Clearly the profile is a little clearer when looking at either extremities or early on in the session when less volume has already gone through. The other thing for me Josh is that when I am about to enter a trade, I am looking at multiple things already, so I have to narrow down my scope of vision otherwise everything I look at becomes blurred.

 

I have tried to show in the chart the things I was looking at for the entry. The reason I had felt that the move was temporarily over was that at 10:30am EST when it traded 64s the price action suggested a struggle. I also noted that Oil Inv came in weak and prices were moving up quickly in crude. Then, the last swing high was taken out in what had been a clear down trend. Then the next push lower couldn't retake the IB low. Volume had built a bit and that again was supportive information.

 

[TheNegotiator 13]

There were a lot of ways to Sell '72 this is just one of them.

 

Direction + Momentum + Trend + Cycle + Price Action = Decent Trade

 

 

Sorry cfrn, I don't really understand what your reasoning for selling 1172.00 would have been. Your chart is a tiny snapshot and there is no indication of what your indicators are and how you are using them.

[joshdance 10]

I tend not to look too much at a volume histogram on a short timeframe. At point of entry, the price action can happen within seconds and so even a 1min histogram masks the speed of the trades coming in.

 

You mean volume per bar, not volume at price, when you say "volume histogram" right? I'm confused a bit as the volume on the histogram updates instantly--what's important to me is not necessarily at what price in the 1m bar that volume is being traded, but that over that bar's high to low range, there's buying or selling interest. Perhaps I'm not understanding what you're saying?

 

I prefer to watch the DOM/T&S and a profile to see if there is a build of vol. Clearly the profile is a little clearer when looking at either extremities or early on in the session when less volume has already gone through.

 

While I watch T&S and place a lot of emphasis on the speed of transactions and in some cases large orders, I have found it impossible to determine reliably an accurate measure of volume. As several hundreds or even thousands of transactions can whisk by in 1 second or less, the tape will not show this, and a quick glance at the 1m volume will say very quickly what it actually is. The profile is of course great for seeing volume build, but as you say only really early on... after a few hundred thousand contracts trade, it's not really useful for seeing short-term, sub-minute or sub-second volume. Even at the extremes, as in yesterday's midday low, it shows volume traded at those prices, but it doesn't really give an accurate picture as to how much at a glance. It's often this type of volume which indicates a more substantial reversal (as opposed to simply a normal retracement).

 

Again, perhaps I'm misunderstanding you just a bit regarding this, would love for you to clarify if I'm not on the same page as you are.

 

As for the trade explanation, thanks so much--perhaps your upper left comment is the most important--something to the effect of "was looking to get short in the absence of buying strength" ... that really sets the tone for the whole thing. You had a short bias with good reason, and when buying failed, you got on board at a very logical place. I was not trading at that time yet but it looks like it was a very logical trade.

 

I'm not at my normal computer and so was forced to watch the market yesterday on a 15" laptop screen. While I would have preferred more real estate, I must say that the market was still in pretty clear view. I had a 1m with volume, and a 500V, and T&S/DOM. No profiles, no vwap, no delta. I really do wish I had delta in a case or two, but really in some cases that throws me off more than it helps. Sometimes net positive delta and flat price can mean a move down is imminent, but sometimes the market buyers win and it pushes up. And while I missed the structure of the profile, I found the simplicity of watching price levels and volume alone to be refreshing. Sorry for the rambling, hope your day is a good one (or if you're in London hope it has been already )

[steve46 12]

Dont know that it matters much to the Europeans, but for me this is a day that I like to trade.

 

Early morning is easy for me (since I am up early anyway)..and because the day is relatively low volume, it is easy to read.

 

Here is a chart of the last (since I am done for the day) reversal pattern...

 

The general rules are that the pattern has to occur at or near a specific area of supply or demand and at or near a specific time...

 

The benefit for me is that I have effectively reduced the need to focus on charts all day long...yes I miss some trades...but the stress levels are very low and and unlike most systems the return vs risk is high....no more grinding out a living hoping that my winners overcome my losers....I wish I had found this years ago....ah well better late than never I guess.

 

Good luck everyone see you next week.

[steve46 12]

Here's an example of the Euro and our reversal pattern...as mentioned the pattern works for all tradable markets and in almost all time frames...I realize this is off the subject, so please once you have had a moment to look at, remove it.

 

Notice if you will that the middle chart shows what I call a "basing pattern"....and one characteristic of that basing pattern is an attempt (we call it a probe) to find sellers....this is one way that traders can determine what the probable future directon is going to be...once that candle completes, you have only a short time until you see a move....we look at it as a valid signal to buy or sell, and of course we use confluence, reading the tape and looking at other data (in our case the DAX market) to confirm that entry..

 

Ordinarilly I would start a thread, but I have another project on the burner and don't intend to post much longer.

 

Good luck folks

[steve46 12]

Heres another screen capture showing a three (2) minute time frame

[TheNegotiator 13]

You mean volume per bar, not volume at price, when you say "volume histogram" right? I'm confused a bit as the volume on the histogram updates instantly--what's important to me is not necessarily at what price in the 1m bar that volume is being traded, but that over that bar's high to low range, there's buying or selling interest. Perhaps I'm not understanding what you're saying?

 

 

 

While I watch T&S and place a lot of emphasis on the speed of transactions and in some cases large orders, I have found it impossible to determine reliably an accurate measure of volume. As several hundreds or even thousands of transactions can whisk by in 1 second or less, the tape will not show this, and a quick glance at the 1m volume will say very quickly what it actually is. The profile is of course great for seeing volume build, but as you say only really early on... after a few hundred thousand contracts trade, it's not really useful for seeing short-term, sub-minute or sub-second volume. Even at the extremes, as in yesterday's midday low, it shows volume traded at those prices, but it doesn't really give an accurate picture as to how much at a glance. It's often this type of volume which indicates a more substantial reversal (as opposed to simply a normal retracement).

 

Again, perhaps I'm misunderstanding you just a bit regarding this, would love for you to clarify if I'm not on the same page as you are.

 

As for the trade explanation, thanks so much--perhaps your upper left comment is the most important--something to the effect of "was looking to get short in the absence of buying strength" ... that really sets the tone for the whole thing. You had a short bias with good reason, and when buying failed, you got on board at a very logical place. I was not trading at that time yet but it looks like it was a very logical trade.

 

I'm not at my normal computer and so was forced to watch the market yesterday on a 15" laptop screen. While I would have preferred more real estate, I must say that the market was still in pretty clear view. I had a 1m with volume, and a 500V, and T&S/DOM. No profiles, no vwap, no delta. I really do wish I had delta in a case or two, but really in some cases that throws me off more than it helps. Sometimes net positive delta and flat price can mean a move down is imminent, but sometimes the market buyers win and it pushes up. And while I missed the structure of the profile, I found the simplicity of watching price levels and volume alone to be refreshing. Sorry for the rambling, hope your day is a good one (or if you're in London hope it has been already )

 

Volume histograms to me is volume traded per bar period. Not volume profile. The thing I am trying to get across is seeing the volume flow as it trades. I personally don't believe you can do this though volume histograms. I think to get a proper feel for the flow you have to have a good connection and setup to see the trades as they come through real time.

[joshdance 10]

Volume histograms to me is volume traded per bar period. Not volume profile. The thing I am trying to get across is seeing the volume flow as it trades. I personally don't believe you can do this though volume histograms. I think to get a proper feel for the flow you have to have a good connection and setup to see the trades as they come through real time.

 

I see -- well, I completely agree with you N. What I mean is that if you only see the tape, then you will literally never see many of the transactions that occur in a sub-second time frame, because they literally never print on your T&S window. Likewise, if you look at a static volume histogram it will not really give a true picture of the intention of the market. So, I like to watch the tape (and find that my 500V chart does well on ES), and I like to have the volume histogram on my 1m chart so that I can see how much volume actually came through, without which I can only guess. When I see a burst of volume and the tape flowing, a quick glance at the 1m volume build and build puts an objective number to it; sometimes I see a strong move up, and the tape starts to fly, but a look at the volume traded shows that it really wasn't very significant at all. Either way, I like to know how much volume just occurred.

[TheNegotiator 13]

I hope everyone had a nice weekend and Thanksgiving! Some big ol' moves going on into rth session open! News driven = caution. Hold on to a loser at your peril!!! Anyway, I have noted down a few simple levels in price which I will look at and try to see how the market reacts after trading there.

 

[TheNegotiator 13]

Euro moving down, ES moving up and ES delta dropping? What you reckon Josh?

[horace 10]

I hope everyone had a nice weekend and Thanksgiving!

 

 

Turkeys and indigenous Indians were not overly thrilled, but there is no pleasing everyone is there.

[joshdance 10]

Euro moving down, ES moving up and ES delta dropping? What you reckon Josh?

 

Hey N -- I actually shorted 94 earlier, and got stopped 95.25 after staying with the trade for a very long time. Still not clear at the moment... we had up, now range for almost 2 hours... going to wait a bit. Beauitiful bell on the profile eh?

[TheNegotiator 13]

Hey N -- I actually shorted 94 earlier, and got stopped 95.25 after staying with the trade for a very long time. Still not clear at the moment... we had up, now range for almost 2 hours... going to wait a bit. Beauitiful bell on the profile eh?

 

So much for it being a busy day eh! I don't know Josh. I just know for sure I really don't like the kind of non-flowing grinding action we saw before. If it breaks lower, then there'll likely be some relieved shorts I reckon. Higher and we could see a scramble for the exits. Who knows though

[joshdance 10]

So much for it being a busy day eh! I don't know Josh. I just know for sure I really don't like the kind of non-flowing grinding action we saw before. If it breaks lower, then there'll likely be some relieved shorts I reckon. Higher and we could see a scramble for the exits. Who knows though

 

Yes indeed--I expected more than a 9 handle range after the movement last night! I think the short was a good try at least, but at this moment I think the prudent course is to wait and then go with the flow...

[TheNegotiator 13]

This day is brilliant. No really I mean just brilliant. :hmpf: Well there could be a move in it later for those who haven't switched off mentally. If you have, don't then trade. If the action remains like this though, I'd imagine there will be some good opportunities tomorrow. We'll see though.