My daily YM, ES, CL, and NQ analysis
Posted 01-10-2008 at 02:20 AM by james_gsx
I thought it would be nice to start posting my daily analysis on the YM, ES, NQ, and CL here. I have a blog that I update daily (or try to) and this will basically have the same thing. Why do I post here as well as my blog site? Quite simple, there are new members here and it might be helpful, chances are they'll never hear of my blog so I hope I can contribute by posting here as well. I am not an expert trader like some, but I do feel that my TA skills are good enough to help others. Don't trade based off this blog, but let it be a reference to what you see. If our views are different, go with what you see. If they are the same, great. I won't be held liable if you make a trade based off my blog and lose money. We have several threads with the same charts but the aren't updated quite as regularly as this. So if you read it and enjoy it, keep reading. If not, that's fine. Or if you have any suggestions, I'm very open....
Overall the market was choppy today; but there was still plenty of money to be made. Screen time is essential with trading. Today was the day that screen time paid off, along with the ability to control your emotions and not expect anything from the market. You had to take your trades and let them work, if they turned out to be a profit or loss was irrelevant, as long as you were following your plan and following sound money management rules.
I want to start off with the NQ as I believe it is the most interesting setup right now. Yesterday the critical 2,000 support level was broken; which is obviously very bearish. I pointed out my next target would be 1950. That target was hit today and turned out to be near the LOD (low of the day). After 1950 was hit price rallied and formed a nice hammer. Normally I would jump at the opportunity to take a hammer on support, but there are a few reasons why I will NOT be taking this trade. The first one is the risk reward. Remember the support at 2,000? Well, due to a change of polarity 2,000 is now resistance, so the close around 1979 means our long position would only have roughly 21pts to work with. The potential risk would be our stop below the bottom of the wick, which is under 1950. I am not willing to risk over 30pts to profit 20, which is not a good risk reward ratio for me. There are several ways to take this trade and none of them are right or wrong, but that is how I would take it according to my plan – which also means that’s why I won’t be taking this trade.
Next up is the YM, I don’t really know what this candle is called but it shows buyers were present around 12,600. Interestingly enough 12,600 is the low from the 400pt decline on February 27, 2007. I find it crazy to believe that we are already trading back at those levels, but we are and buyers were definitely present. Looking ahead tomorrow I see 12,800 as a potential level to short as that is now new resistance. I think we might touch that tomorrow and could see another bounce in the 12,500 – 12,600 range before going lower.
Last but not least, CL. There are two inverted hammers in a row on the $95 support line, along with a wedge forming. The wicks on the hammers tell me that price has tried to move higher twice but lacked any conviction so the breakouts failed. I will wait for some form of confirmation before making any trades.
Hope this helps, if you have any questions feel free to e-mail me.
Overall the market was choppy today; but there was still plenty of money to be made. Screen time is essential with trading. Today was the day that screen time paid off, along with the ability to control your emotions and not expect anything from the market. You had to take your trades and let them work, if they turned out to be a profit or loss was irrelevant, as long as you were following your plan and following sound money management rules.
I want to start off with the NQ as I believe it is the most interesting setup right now. Yesterday the critical 2,000 support level was broken; which is obviously very bearish. I pointed out my next target would be 1950. That target was hit today and turned out to be near the LOD (low of the day). After 1950 was hit price rallied and formed a nice hammer. Normally I would jump at the opportunity to take a hammer on support, but there are a few reasons why I will NOT be taking this trade. The first one is the risk reward. Remember the support at 2,000? Well, due to a change of polarity 2,000 is now resistance, so the close around 1979 means our long position would only have roughly 21pts to work with. The potential risk would be our stop below the bottom of the wick, which is under 1950. I am not willing to risk over 30pts to profit 20, which is not a good risk reward ratio for me. There are several ways to take this trade and none of them are right or wrong, but that is how I would take it according to my plan – which also means that’s why I won’t be taking this trade.
Next up is the YM, I don’t really know what this candle is called but it shows buyers were present around 12,600. Interestingly enough 12,600 is the low from the 400pt decline on February 27, 2007. I find it crazy to believe that we are already trading back at those levels, but we are and buyers were definitely present. Looking ahead tomorrow I see 12,800 as a potential level to short as that is now new resistance. I think we might touch that tomorrow and could see another bounce in the 12,500 – 12,600 range before going lower.
Last but not least, CL. There are two inverted hammers in a row on the $95 support line, along with a wedge forming. The wicks on the hammers tell me that price has tried to move higher twice but lacked any conviction so the breakouts failed. I will wait for some form of confirmation before making any trades.
Hope this helps, if you have any questions feel free to e-mail me.
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Comments
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Nice one James. I look forward to reading your blog.
Posted 01-10-2008 at 02:40 AM by Soultrader
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