Just a quick video talking about the weeks trades and the bounce we have had in the last few days. Had a few nice setups in the sideways day, suddenly 15 point day is "sideways"... Hope you all had a good week. Looking forward to a little less volatility, I hope...
What a week!! After a nearly 400 point down move on the ES the market had what I think is a short covering bounce for the last couple of days. The news media is wetting themselves talking about the "recovery" of the breakdown and "it was only a needed correction." Not so fast, we're not really out of the woods yet technically. The market internals that were incredibly bullish the last few day have already started to turn, and could be ready for another leg down in the next few days. Remember that the market is most bullish at a top and I'm not convinced that we won't have another shot at a low before we're out of steam.
The EminiEdge Zones contained the action excellent today, but with the expanded volatility don't forget to bump up the stops and targets. The less experienced may want to paper trade this yet as a little bounce could be a big loss in no time. The market action had some textbook (EminiEdge Textbook of course!) setups today. The first setup was in the first 15 minutes of the day and was good for a quick 10 points with no heat. That's the way to start the day! After the market bounced there was an entry at 2, with about 12 points here... That's enough for me, but there were two more shorts next for a little reversal setup at 3 and 4, setups related to each other for a couple of points on the first and an easy 3-4 points on the last. At 5 there was another reversal setup which was an excellent setup but didn't quite take off like we hoped, but a few points if you were quick to cover. Lastly there was a nice continuation trade at 6, for an incredibly quick 8 points before there was a snap back to kick us out.before head for an untradable "V" bottom (for me anyway) and an incredible bounce from a new low to a new high for the day in the last hour. Yikes! If we can't get through about 1992 early tomorrow, I'd expect us to take back the a good chunk of the gains of today before settling down for tomorrow... Time will tell, but Trade What You See, Not What You Think!
Good Trades, Joe
All I can say is it's about time! I've been talking about the selloff coming based on the action and internals and we finally got it in the last few days (see discussion about that under "Small Range but Good Profits"). Ranges are expanded to about 5 times normal and moves are quick. Keep those stops out of the way and profit targets big. This volatility isn't for the faint of heart, sometimes it's better to step back and protect the capital until the irrational exuberance wanes. In the video I talk about how to expand the targets and stops as well as multiple setups right out of the EminiEdge Manual. Sorry it's a bit long, sometimes I ramble a bit...
Finally the fireworks day we've been waiting for! At current writing, the Emini is down 32 points, and may not be the bottom yet... Saw another zebra stampede while I was putting this video together and so I talk about that a bit as well. The S/R zones were on the button today, generously netting 27+ points per lot out of two decent trades. Had a couple of small loss/gains earlier in the morning but the last two worked out beautifully. I would not be surprised to see the market sell off near the end of the day as some of the action I saw around 9:00 AM led me to believe that there was MAJOR dumping going on that isn't short term. There were some prints on the tape that seemed like an error, but if not, it may be a major top in for a while. We had 2M+ contracts traded yesterday and if we get it again today it may be pointing to a significant event long term. I'll keep trading the short term patterns and don't really care what direction, as long as I an get aboard some volatility! Hope you got a piece of it... In case you're wondering (probably not!) The fireworks picture was from my new camera on Independence Day, this fourth of July....
Friday presented with a choppy start, winding up 8.75 points for the day. With only .88M contracts traded, lower than normal volume made this seem incredibly slow, though compared to the "Rocket Day" most action would seem reserved. The internals are pointing down, so maybe this is the start of a longer term top. I'll still trade the long side but something is off, seems like we could get a selloff any second... I started the day with a breakeven at 1, then followed up with a profitable short trade at 2, with a perfect exit being right at the next support (first red circle) Once this looked like the sell-off was over for the day, a perfect, "by the book" entry long at 3 (page 27 and 28) and again profits taken at the resistance level (next red circle). That was enough for me for the day but there was another decent short entry at 4, but the strength kept us from getting more than a couple of points if we were quick to cover. One more nice entry long in the afternoon at 5 "by the book" (page 29 to be exact) and you were rewarded with 4 more points if you were patient enough to still be trading (Good for you!)... Overall a nice day and reading the S/R levels kept us on the right side of the market and pointed to the profit taking areas as well. ...Again, our S/R levels were right on the button! Hope you all had a great day and got a piece of it!
Good Trades -Joe
Had a nice and consistent week even though the trade on Friday started off a bit balanced. The video shows one of my tid-bits of wisdom about learning to trade a Zebra Stampede. Don't see these very often but when we do they're fairly repeatable. Traders are a consistent lot... at least when it comes to the psychology of trading... Good Trades!
The fears flexed their muscles today after the pros popped it up just long enough to trap the amateurs. In the video I showed a couple of morning trades I took and a couple of afternoon setups for those still in the market... Sound a little tired, must have been a long day.
Good Day! Before starting today, did anyone else notice the incredible volume spike on last Friday afternoon? Showed me that the pros weren't going to stay long over the weekend... Anyway, just a quick update showing a few of the setups today seen by the EminiEdge followers... The internals were bearish to start the day but I was prepared for this to go up, but the bulls just couldn't hang on. After a bit of volatility from the PMI, I figured to the moon, but it didn't take long for them to run out of steam and push us lower for the day. At 1) was the first short of the day for me, ended up to be 6-1/2 per lot. I would have loved to get long at the support @ about 9:30 but when it was moving it was really choppy and sideways so I passed. Once it started going up however, I took longs at 2) and again at 3), for 5 points combined. This ended the day for me, but had I hung around a few more minutes there was the trade of the day setup at 4) with either new entries or add position size at 5), 6) and 7) until bottoming right in to our bottom support for the day, better part of 20 points! Full disclosure, the top support line at 2098 I added after the open (S turned R) but before 1) was formed, but you didn't need it to take the trades mentioned anyway, as the pattern at 4) didn't require it and it had a nice EE with divergence, and certainly didn't need it for points 5), 6) or 7), which were safer entries to boot... Hope you all got a piece of it today! If you're wondering what the entries were for these trades, take a look at the EminiEdge Trading Manual, it outlines every trade mentioned here today in detail...
Good Trades -Trader Joe
Had an e-mail from "Jason" who asks if I would let him know if I saw any setups on Friday. Holy cow Jason, they were everywhere! The EminiEdge Zones were spot on again and set up some nice longs and shorts. I'll do a quick rundown of what the EminiEdge followers saw on Friday and the setups that I traded... First, right off the bat (1) there was a great opening gap trade, which sadly was too risky for me. Those with a enormous appetite took this short and sat on it all the way to (2). Wow- about 10 points worth! Next at (2) was the first long which again I personally waited on because there were two reports, the Chicago PMI @8:45 AM (earlier for subscribers remember) and a Consumer Sentiment @ 9AM. Right after the report however I jumped on a short (3) and only ended up with 2 points, but nearly had 4. I was ticked nearly a half a dozen times but couldn't get a fill before it reversed and rallied up. Soooo close! At least I was able to adjust my bias and hit a long at (4) and pull out 3 points there. Next I took (5), a nearly textbook setup with an EE diverge right at the resist turned support for a quick 2 points before bagging out. This is where I stopped, being up about 8 points for the day. There were two more setups short, the reversal of the day @ about 11 AM, with perfect multiple setups, an EE, EE divergence and a Spike Reversal pattern setup, all at a Resistance zone. Wow! Only thing left here was for the market to ring a bell to wake up the traders that were napping so they could get short. Again, this was worth 10 points if you had patience and a lot of time. Lastly there was a continuation move with a beautiful Hurl Setup with EE and Divergence, good for about another 3 points. Even though the support holds near the end of the day (how about those zones!), the Market Strength indicator looked off, so nothing worth entering late on a Friday, especially on the last day of the month...
So there you have it. Something for everyone. Hope all the EminiEdge followers got a piece of something. If you're wondering how I spotted and traded these setups, the EminiEdge Trading Manual E-book outlines 6 of the 7 setups in full color detail...
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"Trader Joe" trades the Emini S&P exclusively and is the main influence behind EminEdge.com.
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