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Old 01-21-2007, 08:49 AM
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This member is the original thread starter. Re: ER2 and the 34ema

The thing I look for is a divergence in the delta of the bid/ask going into the 34ema, especially at or very close to Market Profile levels. It also can give you a good exit point on a scalp. ER seems to love MP levels too.

The first pic is a real quicky on what to do without too much MP levels to play off of. You can see rejection inside of value from Friday as we exit value area and bounce back up to the 34ema with a huge divergence. (dont mind the s3 level...my charts daily pivots were messed up friday). As we get the confluence of the 34ema, val, and weekly S1 AND divergence...sweet. Good trade placement would've been right under the 34 as we came back down, just to make sure we were headin' in that direction. A few bars later we get another entry if you missed the first one. Good for a 1-2 point scalp, and then another divergence/34ema entry good for another 1-2 point scalp.

The second pic is of a great trade of the ER being accepted inside of value. There's 2 opportunities to get into this trade at VAL. Both show divergences on the delta graph meaning selling is decreasing as price still wants to move lower. Coming into value area low with divergence AND a market profile level is sweet. As you can see...good for 3 points bottom to top. At around 13:56 you had another entry exactly the same play from VAL to the daily pivot. While one might be tempted to flip the trade there from a triple top...I'm not that brazen. I want to wait for the next 34ema/MP move. at 14:57 price starts showing us acceptance out of value. We blast back up to VAL with a divergence AND the 34ema....sweetness again. From there we ride down to the weekly pivot. A little over 3 points top to bottom. So...this day showed us 9 points using Market Profile and the 34ema.

The red trendline is a 5ema. I use it to see how choppy things might be. When it hangs around the 34 for too long, I dont want to take trades until we see some movement away from the 34 and back to it. Just to play it safe.
Attached Images
File Type: jpg ER_shift.jpg (218.7 KB, 29 views)
File Type: jpg ER2_opps.jpg (229.2 KB, 20 views)

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