THURS - 11-18-2010 - (OVERNIGHT - OPEN) MACRO - ES has seemingly "rejected" a breakout above the 1200-1050 bracket. This could mean an eventual move down to bracket lows near 1050 with 1120 first major pullback to swing support. The sign this is taking place is if the daily chart eventually makes a new swing low after a pullback higher. Today starts the pullback higher as overnight price moves back into the 1193-1180 bracket and all the way up to the highs. The E=MC2 approach doesn't predict. It goes with unfolding flow with evolving expectations to place trade set ups in big picture context. OPEN - Overnight price is way up, moving past 1180 and all the way to the top of the 1193-1180 bracket. 1193 is the logical pullback to resistance point for a rally after price has moved lower to re-enter the 1200-1050 daily bracket so maintain caution for upside follow-thru until 1193 is taken out to the upside. Watch for volume led fade the gap up sell opportunities, be quick to exit continuation buy opportunities that do not follow through past 1193, and monitor first move/first retrace to see what seems to be developing in terms of directional bias relative to the 1193-1180 bracket, knowing a wide swinging day inside this range is a distinct possibility.
THURS - 11-17-2010 - (DAY SESSION PART 1) GAP/FIRST MOVE/FIRST RETRACE - ES gaps up to 1190 area. NO fade the gap structure develops , and E=MC2 looks to go with trend continuation buy set ups instead. Price pauses at 1193 as expected, but then breaks through into the 1206-1193 bracket with trend day conditions in place. Look for E=MC2 trend day buy entries with target to 1206 to start until proven otherwise.
WED - 11-17-2010 - (DAY SESSION PART 2) 11:30 - First trend day pullback entry offers profits into intra-day highs near 1199. Monitor 1200-1196 range to make sure end-to end trend day conditions continue. A breakdown could signal a reversal (if failure swings to intra-day highs above occur first), or it could signal an up day with a trading range in place for the rest of the trading session. Otherwise keep looking for 1206 target.
THURS - 11-18-2010 - (SUMMARY) Price never mounted another swing attempt to new intra-day highs above 1199 and instead traded in a trading range for the rest of the session. The E=MC2 trading trend turned down at 14:30 and an aggressive sell setup developed near 1196 with expectations to move to 1193 bracket low support. Since this was a very strong trend day the aggressive trader could have entered long in the 1193 area for small gains near the end of the day. Price is back up in the 1206-1193 bracket.. As long as 1193 holds look for 1206, and the breakout from this bracket either way will dictate the next bigger move in the market.
FRI - 11-19-2010 - (OVERNIGHT - OPEN) MACRO - ES has seemingly "rejected" a breakout above the 1200-1050 bracket. This could mean an eventual move down to bracket lows near 1050 with 1120 first major pullback to swing support. As mentioned, the sign this is taking place is if the daily chart eventually makes a new swing low after a pullback higher. Yesterday started the pullback higher, and we must see price move back below 1193 if it is to make new daily swing lows. ES price is in a very critical 1206-1193 area as it relates to the next big move up or down. The E=MC2 approach doesn't predict. It goes with unfolding flow with evolving expectations to place trade set ups in big picture context. OPEN - Overnight price has moved steadily lower to key 1193 support. Trading bias starts down, the key will be to see if sell set ups early follow through below 1193 and hold. If so, expect 1180, and eventual new daily swing lows. If 1193 support area holds expect an move to 1206, with resistance levels near 1196, and 1200 that must be taken out as price moves up.
FRI - 11-19-2010 - (DAY SESSION PART 1) GAP/FIRST MOVE/FIRST RETRACE - ES gaps lower, and E=MC2 continuation sell set ups develop to provide nice gains during first move down. As long as retrace move up holds 1193 area, the E=MC2 mechanical trend and big picture are in alignment to the sell side, and we look for price to reach 1180 target to start. Above 1193 would turn mechanical and big picture trend up targeting overnight highs in 1200 area.
FRI - 11-19-2010 - (DAY SESSION PART 2/SUMMARY) The first retrace takes price above 1193 and price works its way up to 1200 area overnight highs, offering many good E=MC2 long trades for most of the trading session.
Would have been great if you had mentioned upfront that you are the author of this book, you did that when someone finally asked you on the other forum : http://www.traderslaboratory.com/forums/f8/professional-day-trading-8814.html Best, Max
I recently saw an interesting post asking, why do we have these discussion forums? What I am expecting to get out of this? What more would you like you like to see out of these forums, etc. Is there any valuable information that can actually teach me how to trade, etc? Obviously this big picture framework is very important for my own trading, and I think could benefit others who may not be processing trading with a bigger picture context in mind. Therefore, instead of just outlining this concept in theory, I thought I'd demonstrate it here in real time to set up more of a practical application type of thread for those who may find the information valuable in terms of getting "inside a trader's mind." I am simply sharing what works for me. My book and this thread - I have always been very upfront that I have just released what I consider to be a unique book on how I trade the ES which covers everything from a realistic trading plan to practical application examples including account statements of how everything ties together. etc. I have NO intention to shamelessly promote the book in this thread! Clearly, in the end readers of the book will decide if the information is of any value to them or not. On the other hand, I have no reservations about mentioning the book up front in this an educational section of ET, and that the information I share in this thread compliments the material presented in the book, and is designed to show to actually how it gets put to use in real time. So I hope this thread serves multiple purposes: (1) The information by itself may open up some ideas for ES traders who are looking to add context to their trading. (2) The "ahead of time" disclosure of the information is a look into one traders mind in real time versus a more theoretical discussion of unfolding events after the fact which may be a refreshing change from other threads (3) For readers of the book, the information is designed to take the form of a trading coach sitting next to them in terms of analyzing unfolding market structure. I'm very aware of the sensitive nature of the trading community when it comes to discussing trading- especially as it relates to trading education alternatives. I've seen it all, and lived it all. Frankly, I am as much of a cynic as anyone out there, so I have no desire to "argue with myself" with anyone who may question my motives, or the nature of this material etc. I will simply say. This is a trading style that works for me. My motives are the same as all others who write books on trading, and I am proud to have put trading information together in a unique form (both book form, and here on this thread) that I hope can help others, either directly or indirectly, with their trading efforts.
Start looking at what instruments outside the equity space that correlate closely with ES and you will start making some hay. There is edge there.