Day Trading the E-mini Futures

[joshdance 10]

Josh for me previous value is found between 1362.75 and 1371.25.....

 

and I simply use my system rules to determine which of my nodes are active and in play on a given day.

 

Thanks steve -- I do not usually look at the "value area" as it's typically calculated and my VAH for yesterday is a bit above that, so I thought maybe you were using some other metric for that.

[steve46 12]

thats interesting...depending on the timing I am willing to use value extremes as entry or exit points

[steve46 12]

last trade of the day

 

Price shows an algo pattern right at the border of a node. I look for participants to try to find sellers below 68 half...when they cannot...you see the long wick extending below the ledge

 

Entry is the next candle, preferrably at the retest of the lower boundary of the wick, but frankly anywhere within 2 or 3 ticks is fine

 

Traders choice to hold or get out with a couple of points.....this is what my class calls a layup...

 

This was my second class of 4 students...and they were all dismissed and asked to go trade on their own....my job is done.

 

Good luck folks

Edited March 1, 2012 by steve46

[TheNegotiator 13]

Steve,

 

The thing is that if a user is subscribed to a thread, they can get email notifications of new posts. For me, it's pretty rare I actually note who the user is and I just come to see what has been written. That is very much my point about the thread. We should all be talking to each other.

 

As far as anyone making comments about anyone goes, well sometimes that happens. But also there are lots of charlatans out there and people are wary. I think the important thing for anyone is to write useful and informative posts so that it's obvious that they are not charlatans. I am talking in general terms for anyone here. From my experience Steve, more often than not your posts have been good. Answering questions and elaborating on ideas only serves to strengthen peoples' confidence that a poster really does have true understanding of what they are writing.

 

So anyway, let us continue with the job at hand:- trading

Edited March 2, 2012 by TheNegotiator

[steve46 12]

Yes for the moment that works

 

and for you Market Profile adherents, the question this evening is when you have a choice between taking entry at Previous Value (1369.25) or at the previous day's open (1368.25)

which do you choose?

 

Tonight the correct answer is worth about $150 per contract....

Edited March 2, 2012 by steve46

[joshdance 10]

Yes for the moment that works

 

and for you Market Profile adherents, the question this evening is when you have a choice between taking entry at Previous Value (1369.25) or at the previous day's open (1368)

which do you choose?

 

Tonight the correct answer is worth about $150 per contract....

 

I would never take an entry at a MP-defined VAL or VAH ... too arbitrary of a calculation IMO. Besides, my chart says 69.00 is the VAL, and 68.25 is the open, so only 3 ticks difference anyway.

 

68.25 was the open, and was breached slightly for about 5 minutes during the news release at 10, and 68 was the area where the market auctioned yesterday late to find buyers below value before the push into the close. So, all those things combined, I'd say 68 is a logical place for the market to find buyers. I think the fact that the market gave 68 significance ALL DAY yesterday is important, not just that it opened there.

 

Check out the SPX chart as well for yesterday..

[joshdance 10]

Look where the market struggled to break through... SPX 2011 high, almost to the penny

 

Market has been rotating around this point all week, and a hold and new highs could really put an exclamation mark on this rally and show the market's intention of where it wants to go. Just one possibility.

[steve46 12]

Yes all very well and good

 

and here in the attached chart, you have traders buying (for the moment) previous value at 1369.25

 

Apparently they did not get the memo about 1368.....although we certainly could see that number later in the session.

 

As to the earlier question about which number would a trader be likely to act upon...for me there are a couple of good answers...first....you read the tape.... always a good way to see whether a bid is held...and second.....and most importantly... if the setups look good (in this case they did not) you take them both....they are separated by only a point....my view is that if you cannot tolerate a 1 or perhaps 2 or more point stop, you probably should not be in the game...

 

Good luck

Edited March 2, 2012 by steve46

[squishy 10]

Hi All,

 

Attached is an example of my current trading screen. I started using just this view a few weeks ago, mostly to see how market profiles developed over the course of the day. It's interesting how very different each market acts and how each profile develops.

 

A curious thing happened though. Paying attention to just this view, with no charts or other displays, has improved my trade location and management incredibly. From simplicity comes clarity, I guess. I'm able to just watch DoM and the volume transacting at each level.

 

I'm looking for something very specific on the DOM. I'm looking for a "sheepdog" trying to keep price up or down. This, to me, indicates big money is playing.

 

The circled area on the NQ contract shows what I'm looking for. There's 300 on the Ask. My read is this trader wants to keep price down. He's not selling, he's buying. Where will he dump? Probably at (PVP + 10 Points). I think this guy got / is getting long at 40-ish (then current PVP). You could scalp long once the sheepdog is removed or fade the likeliest cover area of 50.

 

I watched DOM intensively years ago, mostly on the ER2. I got frustrated after awhile and felt like it was a dead-end. Now it seems more clear, especially when you see multiple markets being help at a level while a big fish is putting on a position. Maybe it's all in my imagination.

 

Anyway, I thought I'd share with you what has been a turning point for me. Hope you all have had a good week.

[roztom 10]

Steve: Thanks for the eariler post on taking the larger swing and the stop question I have been looking at for runners.... The Bernanke break as discussed was very interesting...

 

I was long into that, had scaled and was sitting with a runner and it got stopped B/E.. I did not get short on the break but got long after the extreme low..

 

I have been focusing on my trading as I found that my focus is dimenished when I am posting and since I am an active postion manager I have missed some critical items. I am not as a good a multi-tasker as I used to be...

 

I am working on a bit more programming on my IRT platform since I am a visual and with some of the trend indicators I use I am working on programming them so I have more automated visuals to keep this in my awareness since I can become myopic on my entry chart and lose the forest in the trees... you don't need to many errors to turn a good day into poop. This is something that has been happening more often lately, might be a function of ability to maintain focus - so I have been working towards reducing the load on my multi dimesional awareness and having visual markers flag them for me.. I am not a system guy but have a "systematic" process.

 

I am still reading all the posts and am getting value from them..thanks everyone..

 

When I off-load some of my technicals so it is easier for me to pick them up I will get more active active again.

 

I do want to comment on MP Value Areas. I do not use VAH/VAL for a trade as support or resistance but if a previous days VA is penetrated than I look for the previous VA range to be tested and look for either Prev H/L or a Cumulative Node or VPOC to be tested.. It all depends if we are trding in a balanced fashion in a trading range.

 

Good trading to all..

 

BTW, one of the things that is difficult for me is to test out ideas.. I have to do things manually and I can't program what I do..

 

What I do is look for ideas or refinement after the market, then in playback and then I look to see it in realtime. Often indicators play tricks on you in realtime.. flip-flopping, false positives, etc... so I want to see where the inconsistencies lie.. programming. I am not a rigid sytem guy but I am trying to off-load some of what I watch to visual flags so I can conscentrate elsewhere..

 

That's my update... Good trading All...

[steve46 12]

Tom

 

Thanks for the comment...as regards the issue of focus, I am thinking that this has little to do with age, and more to do with a person's ability to anticipate the timing of possible opportunities...Since no one (except me apparently) brings this subject up, it seems likely that traders do not think it realistic to try to anticipate specific time periods where entries might occur....That is in fact the way I maintain my focus...

 

Clearly the open is the most lucrative part of the day...I am not going to put on a seminar, but if you think about it this is obvious....it is volatile, has the best volume concentration and is frequently moved by news and economic reports....unfortunately to capitalize on it requires skills so I am sympathetic to traders who may not agree because they have gotten burned....oh well.

 

In the afternoon session there are several opprotunities related to my old school training, some may remember the old phrase "noon balloon"....well my students will tell you it still exists....and there are a couple of others in the afternoon have to potential to change a traders day.

 

For what its worth I am going to pursue an idea I had to put together a small room of skilled traders...as you have pointed out, it is difficult to trade ONE market let alone several by yourself..so my idea is to assign markets to traders/students who have displayed areas of interest or expertise...then in either the pre-market (or the previous evening) we willl meet and hash out our best ideas for trade opportunities....I have done it before in an institutional setting and it worked quite well....of course we had the best and brightest at that time, so the odds were good...but I am willing to risk it once again...why not...the time is going to go by anyway....right...

 

Good luck to all

 

Steve

 

Good Luck

Edited March 4, 2012 by steve46

[roztom 10]

Steve: I also like the open but the first 5 min in there it seems it can be demolition derby... Of course if a key node is nearby then all is well...

 

One of the areas I am thinking of revisiting is not to trade as all the setups come by

 

I typically get tossed around in the chop and I have to get whacked a few times before I realize I'm in it.. It seems to me Morning trade up to 10:30 - 11cst , Countertrend rotation during lunch, then 2:00 ish on for the finale...

 

BTW: Steve do you trade GLobex? I often will look at it if we have a report @ 7:30 cst since we can get a bump & potentially get a lead on the RTH... I typically can get a nice scalp off around 6am cst... not usually a lot but a few points... pays for the coffee... :missy:

 

Now when you mention getting older... hmmm I think it is actually a factor.. :helloooo:

 

I appreciate everyone's contributions here.. and I will be visiting reguarly but probably not too much during market hours unless possibly over lunch.

 

Best of Trading To All...

[roztom 10]

Today's open was unremarkable....very average....the attached chart shows some arrows that may serve as landmarks...the left most green arrow is the open....some time later the second arrow shows what I call the "opening range". At the top of that opening range we have a test of Value at 71.25....Because that test occurs a bit too early in the session at 6:36am, I do not take it....(had it occurred several minutes later I would have)....

 

Price then comes back down to test a demand node and in the process it creates a potential higher low (the next green arrow)...scan left and you see a line where price has previously tested....the timing is crucial here...at 6:45 exactly I READ THE TAPE AND TAKE THE ENTRY LONG....I want to hold this entry until either A) my stop loss is hit or B) two minutes prior to the economic report....at that point my rule set calls for me to exit with whatever profit I have.

 

I exit that trade at 6:59:30 as price tests the bottom of a supply node...

 

Negative economic report, and price waterfalls down to previous demand....the spike at the bottom shows where buyers have come in to take a stand..for approximately 4 minutes buy & sell orders fire off...we read the tape and re-enter at 67.75...very poor entry but thats how it goes sometimes...we take the trade and hold looking for a reversal....20 minutes later we are at the top of a supply node so that is where you get off the train....

 

Thats it for the morning session.

 

Steve, where did you put your stop on this entry?

 

tx

[steve46 12]

Sorry for the late reply. I seem to have a cold so I am probably going to be away for a while here.

 

As regards the trade you mentioned I use what is for me, standard stop around 2 pts...frankly if the trade isn't working out, I can see it, because I am watching the tape....If I am wrong I know it sooner than that.

 

and as regards the open....again if you read tape....I don't want to beat a dead horse here...but it seems that most do not....it really makes a difference.

 

Part of the training process when I was hired was that we had to learn what the "open" was...in terms of microstructure...how it works and what the timing is so that we could operate without getting burned....The "first 5 minutes" (and then some) involve processing of retail orders as well as a few other chores that can add to volatility....one would want to be careful in that time period....okay then this isn't the place for a seminar on that subject....back to bed

 

 

Good luck

Edited March 4, 2012 by steve46

[roztom 10]

As we know the open often sets the tone for the day as those early orders are processed until we see a test one way or the other it is hard to see who is dominating... Other times it is good for a scalp if it reverses on you...

 

Statistically I do not do well trying to get a position on the open... What does work for me is once I see a drive out of the gate whether it is an open drive or a open test reverse I can quickly get on board if I am patient on a retracement either back to the mid-point or some other area like the first minute range, etc.. I also look at the volume profile at the prints to guage if there was competition at a specific price so I can see where we might retrace..all in the micro sense... of course Globex Trend, and overall market direction, etc comes into play.

 

Nothing new here on that...

 

I am going to be diligenting working on actually putting more visuals on my software as mentioned so I do not become myopic and miss obvious conflicts... I noticed in my journal that I've slowly been making more errors getting into shallow count-trend rotations only to have them push back on me for a small loss... I believe this is part of the loss of mental processing capability - a new factor for me... especially after all the years of doing this. This is why a Journal is so important. I see it happening more often - but it can be fixed... just need some rails to run on...

 

Good trading..

[steve46 12]

Here is an example of how we look at the Globex open on Sunday afternoon

 

The chart displays 45 second candles which gives us a nice look at the granularity of the market as opens...what we look for is what I call a "signature" which allows us to both predict the next few candles and to get a favorable entry...

 

The background to this is important...before we begin to trade we look at a variety of data to try to determine a market bias for this open....if we think we have a good idea of where the market is going initially, we will take the trade off the open (as you see here)....if we are unsure, we simply don't take this trade....there is no reason to hurry, because there are so many other signals throughout the session.....

 

The nice thing about establishing early position, is that on occaision, when you are right, you can simply hold this while the market continues to trend throughout the night...or you can take your couple hundred bucks and go to bed early...trader's choice

 

Finally if you look at the chart closely, you see that we opened at/near previous value low 1367 now recently I have been hearing from some of you that you won't (or wouldn't) take trades at or near value.....certainly your privlege, but be advised that there are quite a few folks from my world who are trained to do just that (I know I will continue to do so until they "make me pay")..

to each his own I guess...

 

Good luck folks

Edited March 4, 2012 by steve46

[roztom 10]

Here is an example of how we look at the Globex open on Sunday afternoon

 

The chart displays 45 second candles which gives us a nice look at the granularity of the market as opens...what we look for is what I call a "signature" which allows us to both predict the next few candles and to get a favorable entry...

 

The background to this is important...before we begin to trade we look at a variety of data to try to determine a market bias for this open....if we think we have a good idea of where the market is going initially, we will take the trade off the open (as you see here)....if we are unsure, we simply don't take this trade....there is no reason to hurry, because there are so many other signals throughout the session.....

 

The nice thing about establishing early position, is that on occaision, when you are right, you can simply hold this while the market continues to trend throughout the night...or you can take your couple hundred bucks and go to bed early...trader's choice

 

Finally if you look at the chart closely, you see that we opened at/near previous value low 1367 now recently I have been hearing from some of you that you won't (or wouldn't) take trades at or near value.....certainly your privlege, but be advised that there are quite a few folks from my world who are trained to do just that (I know I will continue to do so until they "make me pay")..

to each his own I guess...

 

Good luck folks

 

Sometimes Steve it is so uncanny... I took a long Globex trade off the open Sunday night.. right in the 67.50 area and scaled out at 69.00..just a scalp...this may sound strange but I will do a quick scalp like this just to practice and make some change... I did lean on VAL from Friday at 66.75 and also I had a Volatility Envelope Extreme and then I saw a nice candle bar I liked and then ... just a scalp... I find I can scalp Globex usually for a few dollars as you said.. it typically moves slow enough so I can actually do some other work while monitoring the position... assuming a slow night like we have now...

 

Another thing I like is to read the market when the typical lagging indicators aren't worth much..keeps me sharp to "read" the market... That's how I originally learned, classical charts and "feel." The "feel" was actually a sensitivity or instinct to what todat we call the "auction theory". It was intuitave for me. I couldn't frame it until I learned MP.

 

As I mentioned I am doing some programming tonight so getting a quick scalp off is always good for the psyche... As far a holding a position in GLobex, I have enough trouble sleeping...

 

Thanks for the post, I almost fell over when I saw your chart...

[steve46 12]

Here's a look (the only one that I will publish) at the longer term system that I use to determine

overnight reversals

 

The attached chart shows the action on a 120 min time frame

 

On this time frame I look for potential targets...those targets are the distribution extremes (highs & lows) in this time frame

[steve46 12]

Once I see a viable longer term target, I switch to a shorter time frame

[roztom 10]

Hi Steve: I also have a CLVN sitting at 1360.50... unfortunately I was sleeping at the time.. Now to see if there is an opportunity for a continuation to the next upside target or find a spot to take the other side... that 60.50 was a beautiful area to get long...

 

Good Trading Today everyone

[steve46 12]

Finally we as move toward a decision on pre-positioning, we switch from to the 3 min time

frame looking for a signature reversal pattern....

 

This is one example of that pattern

 

Our system rules allow us to either take profit at our discretion or hold into the open anticipating a trending day....

 

This is why we leave a small piece of our position in play

[roztom 10]

Same thinking here.. I would have scaled 2/3 of my position at apx 64-65.00 area and then wait to see what we have - same thought process here.. unfortunately the :haha: "easy $" has already been made on this one...

[TheNegotiator 13]

Once I see a viable longer term target, I switch to a shorter time frame

 

Unfortunately steve, a chart with so many lines packed on it like that means absolutely nothing to anyone unless they have seen a methodology.

 

Anyway, an idea to share with you today is a simple test of the lower end of the current channel we appear to be in. The lower channel support lines up nicely with distinct volume areas on the current balance profile and the overnight low has demonstrated an interest there too. I think there's every chance of a test there RTH, not to say it will turn there, just that what happens is important. Hold and a reverse to test higher prices again could be on, fail and the lower volume development in the current balance profile could be tested.

 

[steve46 12]

Hi Steve: I also have a CLVN sitting at 1360.50... unfortunately I was sleeping at the time.. Now to see if there is an opportunity for a continuation to the next upside target or find a spot to take the other side... that 60.50 was a beautiful area to get long...

 

Good Trading Today everyone

 

Thanks Tom

 

For us the process is pretty simple, requiring only the discipline to stay up and take the entry, and enough insight (I guess this is really experience) to tell us to stay in the game rather than cash out with a few ticks.

 

As with our previous comments on leaving runners in place, the importance of staying with a trade becomes obvious as the day wears on...if you see this work a couple of times, you start to understand what the impact can be of taking out 10 or 20 extra points on a weekly basis.

 

Good luck to everyone.

[roztom 10]

Thanks Tom

 

For us the process is pretty simple, requiring only the discipline to stay up and take the entry, and enough insight (I guess this is really experience) to tell us to stay in the game rather than cash out with a few ticks.

 

As with our previous comments on leaving runners in place, the importance of staying with a trade becomes obvious as the day wears on...if you see this work a couple of times, you start to understand what the impact can be of taking out 10 or 20 extra points on a weekly basis.

 

Good luck to everyone.

 

Steve: How do you manage this last position? Do you just let it rotate until it gets to your next area - there will certainly be reversal patterns along the way? DO you shift to a higher timeframe and look to major swings to define your trend, and use higher timeframe reversal patterns and pull the microscope out,etc?

Edited March 5, 2012 by roztom