Jan. 26, 2010
Price confluence is an amazing phenomenon. Today many price levels were confluencing to suggest the key targets and reversals. This morning produced a great ABC Bullish pattern with an entry level near 1087.5. Although not a perfect ABC to trade, it is one of my favorite as it showed its strength right at the open. Once this ABC started to trade above the Mid-Fib. Bands (1088.75), a solid entry is confirmed. I was also looking at the Fib. Zone Pivots for potential target to the upside…. Fib. Zone Pivots were placing today’s target in the area of 1100 to 1102.5. Note pHi is at 1099.5. The confluence of these levels may be the target for the day.
Here is the Intraday TradeBlog:
Around 10am, ABC Bull started to take-off and reached the 1st target: 1092.75 (62%). The next target would be 100%AB at 1097. (See my 10.07am chart).
At 10.22am, ES reached Globex High and started to retrace 3 points (See 10.30am chart).
At 11.42am, ES started to rise and head towards the defined Fib. Zone Target (1100) while respecting the VAH, POC, pHi Levels…
At 12.48am, ES reached the Fib. Zone Target of 1100 and showed signs of reversals. This was also evident in CMI 5m chart as CMI
showed significant Divergence at 1100 level.
By 4pm, ES sold off from 1100 levels to reach 1086.
Fib. Zone Levels
End of Day Sell off
Jan. 21, 2010
Symmetric Triangles are continuation patterns and are very reliable. Very rarely (<20%) I have seen failures in Symm. Triangles. Today's @ES showed a methodical failure in Symm. Triangle pattern.
Overnight trading range (Globex) was up as it traded Globex high of 1139.25 to Globex low of 1130.75. At the open, ES was trading near the Globex Mid level (1135). A series of Lower-High swings and Higher-Low Swings prices formed the Symmetric Triangle pattern.
My first assumption was to trade the pattern from long side as trendline breakout above GBXHi: 1139.25. The prior trend before formation of the pattern is in uptrend. 4th swing in the Symm. Triangle was marked around 1132. Once price trades below the 4th swing point, it confirms the Failure of Symm. Triangle. Around 10.15am, price closed below 1132 triggering a Short and confirming the Symm. Failure. The Stop is set above the GBXMid and VAH: 1135.
The range (SIZE) of the Symm. Triangle (1 to 2) is about 10 points. This is the target size from the breakdown level below 4 to 1122.
On Friday, another ABC Bearish pattern emerged from the overnight Globex high (1147.25) to the Globex Low (1137.5). Both Globex High and Globex Low were also marked as Market Structures (MSH and MSL) patterns. At the market open, ES retraced 66% into the AB to mark ‘C’ (1144) pivot and completed an ABC Bearish Pattern. A Close below 200-SMA and EL (1142.75) produced a Sell signal into AB pattern. Targets were: 1138 at 62%, 1134 at 100% and 1128.25 at 162%.
Around lunch time, ES reached its 162% AB Target: 1127.5..
Another ABC Bullish (BLACK, small range) pattern also reached its near-term target (100% AB): 1131.75
Jan. 11, 2010
ES opened strongly higher after trading Globex Range of 1140.75 to 1148.25. Friday’s Value-Range was narrow as the Point of Contact was way below Monday’s Open. The first reaction was range expansion day once price trades above the Globex High. But as soon as the market opened, there was no strength and it appeared the Friday’s POC may be an attraction on the downside. I suspect the earnings jitters are influencing the markets.
1. Market Structure High (MSH) patterns was marked at the open near Globex High (1148). A Good short setup to trade on any weakness with Globex High as the STOP. SuperBars and kTrend will be the trend tools to guide the trade. No clear patterns emerged except a Potential ABC.
Around 10.30am, prices bounced off 200-SMA (1140) to show a tradable bottom.
2. Three Valleys Pattern: One of the rarest but reliable pattern. ES made three lows at 1140, 1138.5 and 1138 in a text book fashion. The range from the top
1148 to 1138 is 10 points. From the three valleys pattern, at least a bounce of 6 points is expected (62%) to the GBXMid range (1144.5).
3. 62% retracement into the range from Globex High to the Day Low…
@ES was pretty lethargic at the open. Started off with a Rectangle channel and traded between
1126 and 1130.75. At 10am, I was expecting ES to trade near Pivot Point (1126) and trend
to continue lower. About 10.15am or so, ES started to rally and started showing strength.
SuperBars and CMI both picked up strength with Green bars.
1. My first trade was a setup to trade one-tick above the Globex Pivot on a breakout. Placed a Long
order to trade upto GbxHigh from 1129. closed near 1130 to 1130.5
Stops were placed below the vWAP (1127).
2. My second trade was the best trade today. After closing my first trade, I placed
a Sell order to short 3c at 1132. I was near certain that R1 (1132.5) will be
resistance and could retrace to pHi. Around 10.45, my trade was triggered and
quickly retraced. After some side-ways anxious time, it started its color and
traded below GBXHI (1130.75). Closed all around 1130 to lock 2 points… Watch the
Pipe Pattern from R1. This is one of the high probability pattern.
3. Some one wrote to me during the setup asking the current retracement was an ABC Bullish Pattern.
It was, but it is NOT a perfect ABC Bullish pattern and internals were clearly
weak. Hence, I wanted a clear confirmation to trade.
Around Noon, the price retraced to GBXHigh (1130.75) and signaled ABC Bearish (Perfect)
pattern. This is one of hte best pattern to trade. I placed another trade around 1130
to short. This time the targets were near 1127. ABC Retraced more than 100%, see
one of the chart.
4. I have NOT traded this as I was little skeptic about PP, YHI bounce
from 1126.5. Prices made a dramatic rally to R1: 1132.5. Did not participate
as I was busy working something else.
Today was an interesting day. A Strong open (about 8 pts up in @ES) signaled
a solid up day with Dow may closing at least 100 points up. Pre-market Flag setup
is also an interesting setup with a potential trade.
Pre-market, price retraced to the Globex Mid point in a Flag setup.
Initial reaction was to wait for the Pivot (1114.75) buy.
But right after the open the trend was clear. I wanted to buy above
Globex High (1120.5) with a setup to pHI: 1124 to Fib. Zones Range (1125-1126).
1. I placed an order of 8c at 1121 just above GBXHigh. Filled at 1121.25.
Targets were set at 1124-1125. Also Stop set at 1118 (3 points), just
below the bands… About 10-12 minutes later all Contracts hit the targets.
Closed few at pHI. Check Internals, CMI and kTrend for a pullback.
2. Around 11am, market lost its momentum and trading very slow. Still
uptrend as SuperBars were strong. No Patterns formation visible other than simple breakouts.
Trade in the direction… But my CT instinct kicked in on red CMI Ribbon.
So, I took a 3c short with a very short time frame ideas. Also, betting on market
trading at R2 and may be tired. Wanted 1-2 points on 3c. About 10-15m
later, still prices were printing GREEN SuperBars. I was in 1 pt profit
so, I peeled them out slowly.
3. 1.30pm: Still thinking it will move up. CMI5 turned RED around 12.30pm.
R2 seems solid resistance. Saw first Red on CMI15…. A risky setup.
Traded Short thinking there will be TICKDUMP and then moveup. Wanted a CT
trade with Quick-in-Out for TickDump. Placed a stop above R2. Got just 1 point
for all 3cs about 2pm…
4. 2.30 pm: Placed a Buy above R2 with 3c.. Never traded. Around 3pm, I closed and walked off.
Only Four Trades today in @ES. Not focused on other instruments as no clear patterns were
emerging other than straight upside.
Here is the Link to Todays’ Daily Chart Blog on my website: http://www.surinotes.com