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took a short about 1:15pm central at 1401.25 from that drop, after some consolidating. Stop out for -1.25pts.

 

Silly me, went short right in the middle of the trading range 1402-1401. I didnt even wait til price break 1401 atleast to continue down. :crap::crap: :)

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I wrote here about the context yesterday and why there shouldn't have been any reason to try to sell the market. I hope everyone realised this and did very well too.

 

Into the next event. NFP in 15mins. Will it be a terrible figure? Not sure. If it is will the market reverse yesterday's work? Well I'm not certain of that either. If it did it could be extremely negative technically. But thinking about it logically, if it were a terrible release the markets would drop but then QE3 predicting bargain hunters might very well look to stock up. Let's see what it does do then assess it.

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So NFP came out at 96k exp 130k with a downward revision to 141k from 163k for last month's number. Unemployment fell however to 8.1% from the expected 8.3%. Okay so in asking what might happen after these releases, I'm looking at the fact that ES has not plummeted but the dollar index has. I think that's the tell, but let's see what does happen.:2c:

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Though.... I think we'll see a pullback during the session very close to yesterdays regular session high... but, during news events like this (and the other day), i just like to go for the easy money if an opportunity shows up... i'm never comfortable holding much for very long in such active event driven markets.

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The most traded price post nfp has been 34.00 which is also pretty much the midpoint of the overnight session (34.25).

 

And... as you said it was the most traded price... .we really couldn't crack much under it on this little swing down. I think the RTH open will see a push deeper... but i'm expecting a bit of a ranging market... that won't move much lower than yesterdays RTH highs... if it does hit there, i'll look to get in again long most likely.

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Though.... I think we'll see a pullback during the session very close to yesterdays regular session high... but, during news events like this (and the other day), i just like to go for the easy money if an opportunity shows up... i'm never comfortable holding much for very long in such active event driven markets.

 

Definitely can be difficult with the potential for so many to act in the market in a short space of time. I don't know what we'll get today. It could be a standard summer friday with not much to do past about 10am and that would tie in with a rest day after the big move yesterday. However, if that jobs data is believed to be enough to force the fed's hand and commit to QE3, it really doesn't matter which day of the week it is.

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Definitely can be difficult with the potential for so many to act in the market in a short space of time. I don't know what we'll get today. It could be a standard summer friday with not much to do past about 10am and that would tie in with a rest day after the big move yesterday. However, if that jobs data is believed to be enough to force the fed's hand and commit to QE3, it really doesn't matter which day of the week it is.

 

Well, given the size of the breakout in the ES... and the fact that we basically ran right into a pretty significant trendline at todays london session highs... and the mixed news...

 

after such days, it's not uncommon to see the market range for a day. I think we'll see that, and i'd like to get something long if we can retest the low of the range... considering that it seems a bull move is underway, rather position for a decent long than a not so decent short.

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Well, given the size of the breakout in the ES... and the fact that we basically ran right into a pretty significant trendline at todays london session highs... and the mixed news...

 

after such days, it's not uncommon to see the market range for a day. I think we'll see that, and i'd like to get something long if we can retest the low of the range... considering that it seems a bull move is underway, rather position for a decent long than a not so decent short.

 

Yup.

 

Long-term profile snapshot:-

 

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2012-09-07_2.thumb.jpg.48aada4871d244a7e2043d24d01707fc.jpg

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from a few things that i've read, and more that i've seen myself... it seems most folks look to fade breakouts at some point in time... but after such a range has developed as the ES showed during august, actually buying the breakout is the way to go, because such moves are nearly always underestimated by many traders, and for the rest, waiting for a pullback is what many will do.

 

It is just such occassion that pullbacks don't really occur, and you get these one directional freight trains.

 

I'm not saying today will be such a continuation... but i'd be quite surpriesd if the S&P didn't continue to make daily higher highs and higher lows for at least another couple days...

 

personally, I believe a retest of 1441 is in the cards within the next 2 trading sessions.

 

Essentially, the longer a range builds up, and the tighter it is... the more transactions take place. When price does finally break, as it did yesterday, the magnitude of players holding losing positions is so much greater, due to the time that the range built up over.

 

In most cases, waiting for a pullback will work, because profits will be taken after the breakout, as well as some new shorts getting in, pushing price back to retest the prevoius range...

 

however, in such a case as this, the magnitude of traders holding losing positions is so great, that there is an equally great need for such losing players to cover their loss. And again, because there are so many, you will often have some party or another buying even the shallowest of dips... thus the losing traders need to cover is great enough, and the magnitude of losers also great, that no real pullback occurs.

 

 

I believe this recent move up is such a breakout. It is nice that it also corresponds to my contrary view of the market (i've been bullish the US stock market for at least the last 2 months)... but regardless... when price breaks from a relatively significant range, fading it is usually the wrong play.

Edited by ForexTraderX

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