My Daytrading Method

Plan for Tuesday:

VR = 1306-1307

Today was a classic reversal day. The market opened strong and charged higher but as the day progressed it was unable to keep the momentum going. It ended up closing below the 9.30 open.

I will look to sell here. 1315 was handily rejected so I do not think we'll get there any-time soon. If the market opens higher than 1307, I'll look to sell at 1311 with a stop at 1315 and if it opens lower, I'll sell at the VR. Usually in a strong bull market it is the ER and NQ that out-perform YM but that's not happening right now. The only thing keeping this market higher are few quality stocks as people are getting out of the speculative issues and putting it on blue-chips. Starting tomorrow we should see money coming out of the blue-chips too.

I would fade any rally here. If the market opens above the VR and you decide to buy, take quick profits. If it opens below the VR, I'd stay with it till close (unless stopped out).
 
pitbulltrader,

That's an excellent question re contract rollover. I wrestled with it quite a bit myself. What I'm doing is a combination of things to overcome the rollover issue.....and I'm not positive its the right way to go abou it, but it seems to work fo me.

First, I look at SPX as opposed to ES MP numbers for the long term and then adjust for the premium....this is part art so the MP numbers are not completely accurate. Second, I have used various time periods for a longer-term MP view. For instance, I'm also looking at the MP profile from 3/17 - 3/31, with the MP numbers for that being approximately 1316.5, 1311.5, 1309.25.

What ends up happening is that I have many levels (probably too many at times) to watch for during the day and a big part of my strategy is watching the T&S and using bid/ask analysis (with a filter for > 50 contract size). I've learned that it's especially important to watch this data as ES approaches and moves thru the various levels.

Sorry to 007 for hijacking your journal......
 
Here is how I come up with support and resistance.

since my risk per trader is 4 pts. I'll have price in 4 pt. increment on the left column. On the right column, I'll have the number of times the VR fell at/above the price. Please see attached.

So for today, the VR based on 3-31 was 1306-1307, so I'll put 1 next to 1307. I'll keep a running total for the last 4 weeks to get the support and resistance.

As you can see, there is 5 next to 1315 and it was the largest number, so I knew that it'll be a strong resistance besides we haven't closed above 1315 for a while. Today we closed below 1307, it'll be a tough to go higher from here as there is strong resistance from 1307 to 1315. Out first target on the downside is 1291. 1291 will not likely provide the support the first time. We'll probably go below it and if we rebound from there, it will provide support on the next sell-off.
 

Attachments

Hi Emini...you may have covered this but why are you using a 4 point stop each time.....? I also think you should be using some form of signal bar at your predefined levels....for entry at least....

Side note...with average weekly ranges running in the 15 - 20 point ranges it just seems logical that after we dropped down into the 1303 - 1302 area...hint look at buying candles on 30 minute chart and where did Chartx have a high volume line at...anyway always easier to point out in hindsight...so any way if we take 1317 as a high and subtract the 15 points gets us down to 1303 area....then 1297 is full 20 pint target...I like taking the last 3 weeks range add them all together and divide by 3......for a full target....some use 80% of this number as targets....If we start making new highs then we have to start adding the weekly range projections to the lows to get upside targets.....just some thoughts here...make be useful to someone other than myself...lol...sorry about todays trades..
 
Okay guys. This will be the end of my journal.

I think my strategy works well if I were to take 4 pt. profits and use a trailing stop and/or combine a technical indicator to enter my trades. I will start trading actual cash from tomorrow.

Many thanks to all the people that were very helpful in the last month, especially pitbulltrader.

Will update you at the end of the month.

Here is the VR for Wednesday.

1314-1315

1315 has been strong resistance too.

Good Luck.
 
Quote from eminitrader007:

Okay guys. This will be the end of my journal.
More...


Too Bad; I enjoyed reading your trials and tribulations.

Best of luck with your trading and thank you.

All the best:
 
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