[steve46]

This is a little off the subject of my thread but I do want to offer a comment about pivots as follows;

When I trade I keep track of daily, weekly and monthly pivots. I prefer however to take trades based on the confluence of weekly or monthly pivots and moving averages. I also take trades when pivots, moving averages and Market Profile numbers line up. If I can get those three planets to line up, I find that produces the best percentage success. I stay off (or fade) trades based on daily pivots. I do this because I believe that retail traders and weak hands are often using daily pivots as entry points. Generally speaking I want to be on the other side of those trades because that group is often wrong, they are easy to flush out of their positions and their stops (when they use them) are the fuel that moves a position in my favor. I don't say this to insult anyone. If you (any of you) use daily pivots, so be it. Divergent viewpoints make the market what it is.

The area annotated on this chart shows the confluence of two pivots (daily and weekly) and the Value Area Low is also right there at 1295. Short entry in this area is essentially a bet that price will be rejected from previous value.

[steve46]

Ordinarilly I won't be posting during the trading day. This one worked out nice and I think its a good example for those who might want to see a trade in progress.

I got long on what I call a reversal move at 1264.75

The chart is self explanatory based on previous posted data.

Simply put I like to enter on the retest of an EMA

[steve46]

Then as the trade progressed I scaled out all but 2 runners at DVAH 1270.25

I did this because I have seen price reverse at the DVAH many times. In fact this area (DVAH) is often a good place enter trades. I chose to stay in my long position and watch.

[steve46]

and another shot as the trade continues

I scaled out another unit at 1271.75

At this point I moved my stop to 1268.50

[dandxg]

Steve, question for, since you like to look for a confluence of S/R, which makes sense, what do you do when they are spread up by a couple of points? It's logical to what for everyone to agree and use the same S/R area, but often times they are just a bit off. For example, the VAH may be one place and R1, RTH, is 1.5 pts. away?

In that instance would you pass, scale down, or stand aside? Thanks for sharing,

Dan

[steve46]

Sure I understand. If the spread is more than a couple of points I look to the strength of the setup (whatever is closest to price). So if my 200 period EMA is closest to current price, and the nearest S/R is more than 2 points away, then I may trade it based on how it acts around the 200, but I don't expect much "help" from the S/R area.

Also you should take a moment to watch whenever price is near to a pivot or established S/R. What I have found is this....if price is going to go through (take out that area) then it will often do so on a wide range bar. Since we are all watching the Olympics these days, the example I will call on is a high jumper running up to the bar. he has to generate momemtum before he can clear that height. Same with price as it goes through an area of S/R. This means that if you are wrong, be ready to bail as price can and will often move through an area of S/R with a sudden spike or impulse move.

The opposite is also true. If price fails to take out an area of S/R it will often move right away in your favor. If it doesn't or just consolidates I will often scratch the trade. I don't mind missing a move because my system always provides another setup to trade.

I hope this helps you

Steve

[steve46]

and this last post to show how that trade ended as I was stopped out at
1268.50

[steve46]

This is my final trade for the day

Again we see price test an area where both the 200 EMA and S1 are close together. This is a good short entry, but if you missed it, be patient cause here comes the retest.....