Daytrading the ES
- Thread starter Port1385
- Start date
No trades today. Not feeling very well and dont want to be playing with money right now.
Here is what I was thinking yesterday. That big solid line down the middle of the chart is where I thought the breakdown would occur. It almost broke down, but reversed course in a classic bear trap. However, right now the es is trading right around 838. We may get that breakdown today and, as the other charts suggest, there is a lot of room to fall.
That overhead trend line that just formed will be a breakout point if it ever reaches above that one. I dont think it will.
Here is what I was thinking yesterday. That big solid line down the middle of the chart is where I thought the breakdown would occur. It almost broke down, but reversed course in a classic bear trap. However, right now the es is trading right around 838. We may get that breakdown today and, as the other charts suggest, there is a lot of room to fall.
That overhead trend line that just formed will be a breakout point if it ever reaches above that one. I dont think it will.
It's obvious that you're putting in a lot of time and effort on this thread. It's very much appreciated.
I'm trying to learn the moves of the ES and it's good to see someone else's thinking patterns. The problem with only trading the ES is that you start looking for trades even though there really isn't one. Your short yesterday around noon didn't seem particularly compelling to me and I would have avoided it. The technical setup was weak and the time of day (noon) is the churning, low volume period. The trade I would have taken was the long at 843 a little after 11 am. This was a higher probability trade when it touched the bottom of your trend line.
The toughest thing about trading the ES is that you have to know when NOT to trade. The beauty with stocks is you could always look for something else that is moving if your bread and butter stocks are stale.
Anyway, keep up the good work. I'm definitely learning a thing or two.
I'm trying to learn the moves of the ES and it's good to see someone else's thinking patterns. The problem with only trading the ES is that you start looking for trades even though there really isn't one. Your short yesterday around noon didn't seem particularly compelling to me and I would have avoided it. The technical setup was weak and the time of day (noon) is the churning, low volume period. The trade I would have taken was the long at 843 a little after 11 am. This was a higher probability trade when it touched the bottom of your trend line.
The toughest thing about trading the ES is that you have to know when NOT to trade. The beauty with stocks is you could always look for something else that is moving if your bread and butter stocks are stale.
Anyway, keep up the good work. I'm definitely learning a thing or two.
Here is my last post for today then I have to go do some things.
This is a chart from another site that I use, not my own chart.
During the holiday times, usually bad news is released. The reason for that is "they" want the holiday to dilute the bad news and for investors not to take as much notice as they otherwise would on regular trading days. You simply dont know whats going to happen over the next 5 days. If there is bad news then it will be released during the next 5 days.
Taking a look at this chart you can see how this is setting up nicely for a fall. I can picture on Monday, after the holidays, the regular traders reacting to all of the bad news that usually tends to get released over the holidays.
For those who do not like volatility or unpredictable situations, then its best not to trade a few days before and a few days after a holiday. However, these are truly the best times to make cash.
You know the probability here is for a nice slide. There has to be a little bad news out there in which will be released over Thanksgiving.
By the way, this chart updates throughout the day so you can come back here to see how it plays out. There will be a different price in the chart each time you look at it.
Happy Thanksgiving to all.
This is a chart from another site that I use, not my own chart.
During the holiday times, usually bad news is released. The reason for that is "they" want the holiday to dilute the bad news and for investors not to take as much notice as they otherwise would on regular trading days. You simply dont know whats going to happen over the next 5 days. If there is bad news then it will be released during the next 5 days.
Taking a look at this chart you can see how this is setting up nicely for a fall. I can picture on Monday, after the holidays, the regular traders reacting to all of the bad news that usually tends to get released over the holidays.
For those who do not like volatility or unpredictable situations, then its best not to trade a few days before and a few days after a holiday. However, these are truly the best times to make cash.
You know the probability here is for a nice slide. There has to be a little bad news out there in which will be released over Thanksgiving.
By the way, this chart updates throughout the day so you can come back here to see how it plays out. There will be a different price in the chart each time you look at it.
Happy Thanksgiving to all.
Sorry, couldnt help myself when I saw the markets right at the 872 line. Price is almost teasing us. Some might go long right about now while others might go short. Making a trade right now is gambling either way. You just dont know what will be announced the next 5 days.
Im going to place the odds on going long or short at this time at 50-50.
Here is the bullish argument for what might occur:
Im going to place the odds on going long or short at this time at 50-50.
Here is the bullish argument for what might occur:
Happy Thanksgiving!
I avoided the market and just observed on Weds because I wasnt feeling up to it and trading right before and after the holidays is unpredictable. Money can be made, but its not as safe as trading away from the holidays. Trading around the holidays has tanked many accounts and it should just be avoided in my humble opinion.
In reading all of the blogs and this website, looking at the charts and the news, I was swayed to change my bias. I even drew out a nice chart demonstrating an inverse head and shoulders which seemed to make a lot of sense. Then in going through the charts, I saw a few things that concerned me.
The blue line on this chart is the 20-day moving average and there is definately a trend line. The magical thing about charts is that depending upon the way they are drawn they can show a very bearish or very bullish market. This is not a very bullish chart. You can see price brushing up against the bottom trend line and how it never got over the 20-day moving average. The market had a reason for not carrying this over the 20-day moving average and not going higher.
This leaves open the possibility that Friday or Monday might be a good sell-off and we go lower. I read somewhere on this site saying that the market didnt pierce the 2002 lows by that much so it must be a bottom.
Lets see if that logic holds true. The logic isnt bad, but the price did go lower then in 2002 and we still have a lot more margin on the books at around 190-233 billion with a steeply declining housing market then we did in 2002. In 2002, the margin at those levels was 130 billion with a steeply inclining housing market.
We'll break down the S&P in just a few minutes and I'll show you what I am seeing sector-wise.
I avoided the market and just observed on Weds because I wasnt feeling up to it and trading right before and after the holidays is unpredictable. Money can be made, but its not as safe as trading away from the holidays. Trading around the holidays has tanked many accounts and it should just be avoided in my humble opinion.
In reading all of the blogs and this website, looking at the charts and the news, I was swayed to change my bias. I even drew out a nice chart demonstrating an inverse head and shoulders which seemed to make a lot of sense. Then in going through the charts, I saw a few things that concerned me.
The blue line on this chart is the 20-day moving average and there is definately a trend line. The magical thing about charts is that depending upon the way they are drawn they can show a very bearish or very bullish market. This is not a very bullish chart. You can see price brushing up against the bottom trend line and how it never got over the 20-day moving average. The market had a reason for not carrying this over the 20-day moving average and not going higher.
This leaves open the possibility that Friday or Monday might be a good sell-off and we go lower. I read somewhere on this site saying that the market didnt pierce the 2002 lows by that much so it must be a bottom.
Lets see if that logic holds true. The logic isnt bad, but the price did go lower then in 2002 and we still have a lot more margin on the books at around 190-233 billion with a steeply declining housing market then we did in 2002. In 2002, the margin at those levels was 130 billion with a steeply inclining housing market. We'll break down the S&P in just a few minutes and I'll show you what I am seeing sector-wise.
These are the sector etfs since the start of the year. The S&P500 is broken down into 9 different sectors and sector has a different weighting.
Here is what I am seeing when I read these charts:
XLF- Still making lower lows, lower highs. The 20 day moving average looks just as steep (declining) as it was a month ago.
XLK, XLI, XLB, XLV, and XLY - Same as the XLF except the 20 day seems to be leveling.
XLE, XLU- This looks like a true bottom in the making- Price has tested a certain floor for the last 3 months and now it has closed above the 20 day moving average and now needs to get above the 50 day. The 20 day has turned upward and you can imagine those lines crossing within the next month. I can say with 75% certainty that the energy sector has bottomed and we might be making a bull run in oil and solar.
XLP- Same as XLE except the 20 day has not made as great of a move as the XLE. Im a little less certain that this is a bottom for the XLP, but I am over 50% sure we have bottomed with that ETF.
XLE= 14.4%, XLP=13.35, XLU= 4.35%,
So 32.1% of the S&P500 we can feel with at least 51% certainty that there is a bottom in place. As for 67.9% of the rest, I cant say with any certainty as there has been no retest and the 20/50 day have not turned towards each other.
What do we know of stocks and etfs like that have a pattern of making lower lows and lower highs? They generally keep making those patterns until they dont. The XLF could easily be 6 in a few months, the XLK could easily be 7.5 in a few months. I dont feel the same about either staples or energy though. I think those could easily be higher in a few months.
So I'll wait and see what Monday brings and update my bias depending upon what happens and trade accordingly. I only make trades along my bias. If my bias is to the downside, then I only make short trades. If my bias is to the upside, then I only make long trades. Simple enough My bias for now remains to the downside.
Here is what I am seeing when I read these charts:
XLF- Still making lower lows, lower highs. The 20 day moving average looks just as steep (declining) as it was a month ago.
XLK, XLI, XLB, XLV, and XLY - Same as the XLF except the 20 day seems to be leveling.
XLE, XLU- This looks like a true bottom in the making- Price has tested a certain floor for the last 3 months and now it has closed above the 20 day moving average and now needs to get above the 50 day. The 20 day has turned upward and you can imagine those lines crossing within the next month. I can say with 75% certainty that the energy sector has bottomed and we might be making a bull run in oil and solar.
XLP- Same as XLE except the 20 day has not made as great of a move as the XLE. Im a little less certain that this is a bottom for the XLP, but I am over 50% sure we have bottomed with that ETF.
XLE= 14.4%, XLP=13.35, XLU= 4.35%,
So 32.1% of the S&P500 we can feel with at least 51% certainty that there is a bottom in place. As for 67.9% of the rest, I cant say with any certainty as there has been no retest and the 20/50 day have not turned towards each other.
What do we know of stocks and etfs like that have a pattern of making lower lows and lower highs? They generally keep making those patterns until they dont. The XLF could easily be 6 in a few months, the XLK could easily be 7.5 in a few months. I dont feel the same about either staples or energy though. I think those could easily be higher in a few months.
So I'll wait and see what Monday brings and update my bias depending upon what happens and trade accordingly. I only make trades along my bias. If my bias is to the downside, then I only make short trades. If my bias is to the upside, then I only make long trades. Simple enough
My bias for now remains to the downside.
I wanted to evaluate my thesis above on the XLE using an old oil chart I had. Well, even the XLE thesis isnt very solid because Im not certain if oil is turning around.
Oil hasnt made it over the bottom trend line, but has simply retraced (for now). So even the XLE could fall out if this is just a retracement and not a turnaround for oil.
I see SnP 630 now a little more clearly then I did before...
Oil hasnt made it over the bottom trend line, but has simply retraced (for now). So even the XLE could fall out if this is just a retracement and not a turnaround for oil.
I see SnP 630 now a little more clearly then I did before...