Pull back from Monday

Today's profit + 46.95 es
Accumulated week: +77.95 es

week 5: + 235 es
week 4 : +70.1 es
week 3 : +23.7 es
week 2 : +37.75 es
week 1 : +21.8 es

Today I try to scale in several time but still I need to improve the system, I don't think I am doing it right. Average losing trade today was 2.54, as I didn't use my fixed stop loss of 1.5 points. I was setting stop where it makes sense, but today in a 10k chart the bars were between 3-5 points!. Today I enjoyed price action as areas of support and resistance were very clear on the chart.

U2: It is a beatiful day +80

+80.7 es points in what I think it is the bottom of the market.

+235 es points for the week. With a 15k per contract that would be a 78% of the account.

Bottom of the Market

SPY has touched 83.5 and ES 837.

This is likely to be the bottom of the market.

Panic Selling

FTSE has gap down and major Asian indices crashed badly. FTSE looks like will try to close the gap.

I would like to see the ES gaping down finally to signal the end. The general thought is that an opening gaping down an reversal intraday could be the final bottom of this downtrend (it is more like a dead cat falling than a downtrend).

Tomorrow Bush will be speaking at 10:30 and it is also expected an emergency plan from the Fed pretty soon and it could be the trigger for a significant bounce in the markets.

This week unfortunately I couldn't trade too much except by Monday the whole day. I am +159 ES for the week with 1 contract (a couple of times I tried scale in, scale out). Which by far it is the best week since I started simming. I think the week has been very easy for day traders. I think it has been a very good experience in general and I feel closer to my target of being consistent.

I will look in the charts how high will go the bounce in the short term.

Don't break your trading plan

Last night couldn't sleep and spent about 30 minutes looking Z (FTSE) and watching ES reacting to its move. I entry long, and when the trade was in +5 moved the stop to BE then I set the target and went to sleep. This morning I woke late and the trade hit the target +25.15 points. It is funny but sometimes my best trades are like this and the reason behind it is that I don't move the target because simply, I am not looking at the screen, I just set it up where it makes sense. The whole point is "Don't break the plan", so many times I get out too early and the market finishes at the price I initially set the target.

Market Bottom?

I am thinking a couple of options here.

Black Monday ?

+ 81.71 ES points with 1 contract and a couple of scale in.

This was my best day since I started simming. Though I am very aware that this was an exceptional day so I am not very excited. I have to be consistent on weeks with 15 points day range.

These are the profits in the last 4 weeks with one contract in ES:
week 1 : +21.8
week 2 : +37.75
week 3 : +23.7
week 4 : +70.1

Today, all the trades were based on Resistance/Support and Price Action. Due to the volatility I moved lot of trades to BE + 1 ticks so I got stop out many times, but always I used the opportunity to get in a better price. I think I have still a lot to learn to avoid overtrading. This day was an excellent day for 4-5 trades such as: short 70 , short 60, long 45, short 60, short 30 and long 30 and very discipline with the targets.

Big Picture SPY

Day traders must have no BIAS to be able to adapt to any outcome and go with the flow but I like to play guess games where I look for mayor resistance support pivots and channels guessing possible outcomes in the market. The main idea is to look always for confirmation and follow the trend so I don't use this analysis to trade, I use it to exit or avoid trading in problematic areas.

There are lot of blogs watching for a mayor crash this week or next week. Actually, some blogs are pointing out tomorrow as Black Monday.

Option 1:

When I am looking to the downtrend channel, It looks to me like this wave from the 1315-ish to the 1100-ish has reached the same extension than the previous wave 1437-ish to 1200-ish, so It would make sense some kind of bounce. I am not sure what might trigger it because the sentiment is very negative but I would not be surprised either to see something from the FED or some bullish news (if that's possible in this market).

Option 2:

Otherwise, we would extend the wave down to the next pivot and possibly falling like a knife breaking all these supports quite easily. When channels don't make 3 Highs or Lows aligned and the third one falls short to reach the trend line the wave goes in acceleration mode. So breaking the red channel or getting short to reach in a pullback the blue channel the market goes down the rabbit hole again. If the bounce does not reach the 1220 and bounce from 1175 the wave might accelerate again. I am looking at the chart and there are so many possibilities about different bounces that this is a very difficult game to guess what is next.

I will be watching the support/resistance lines in the chart and watching how the market reacts (1220ish, 1275ish, 1104ish, 1060ish, 1010ish etc).

The next chart is a 100k of ES. Asia is droping already so if Europe continues the drop we might have the snow ball effect into the market tomorrow. It is interesting the Up Trend Line from the bottom 2002-2003 and more interesting would be the confluence with a resistance/support pivot.

About me

First at all, my first language is not English so I hope that people reading the blog will forgive many mistakes in my posts.

I have been trading for many years. I started with stocks, then progress into options trading which I have been doing for the last three years.

At this time, My main focus is to study the futures market with my determination to become a full time day trader. I want to replace all my swing trading with options for futures and shorter the time I am invested from days to hours or minutes, something that usually I can do only with options in the expiration week.

I hope that anybody that read this blog can learn from my mistakes or my success. I will be posting charts with my trades (part time) and studies. Do not worry, until I can make consistent profits every week for enough time I will be paper trading ES.

Thanks

Pacpac