[james_gsx]

I agree Brownsfan, I am seeing pretty much the same thing. There are better markets to trade right now, but I will keep this to the ES discussion.

I would like to see the ES hit the 50SMA before entering a short position on a swing trade. Better yet, a close above or below the trading range.

[brownsfan019]

Originally Posted by james_gsx »

I agree Brownsfan, I am seeing pretty much the same thing. There are better markets to trade right now, but I will keep this to the ES discussion.

I would like to see the ES hit the 50SMA before entering a short position on a swing trade. Better yet, a close above or below the trading range.

I agree - it will need to break this zone to get some momentum going again. However, as we wait, there are possible trades available. The 80 pt move on the YM wasn't much, but I'll take $400/contract while I 'wait' for the momentum to appear again.

[brownsfan019]

I wanted to mention something in case there's a question or two on the chart I posted.

Looking closer at the recent action:




#1 and #2 provided trading opportunities in our zone here.

I would have preferred though if #1 at least made it back to the 50 SMA or even the upper yellow line. I was hoping we would see that but since the day before #1 was a bearish day, it would have taken a lot to get that #1 trade up to the SMA.

I would have liked to see #2 get to the low of our zone (lower yellow line). Again, it did not this time.

So the question anyone trading this would have to ask is did these entries meet YOUR criteria. I'm not excited about them, but there was potential profit there as well. On this new long, I'd like to see it test the 50 SMA and/or upper yellow zone (see a pattern?).



And the flip side to this is if you can find the well established zones, you could anticipate that and place resting orders to buy or sell based on those levels. This is a tad more tricky and requires some finesse in my opinion as you have to be willing to buy into an down move and sell into an up move. And stop placement is critical as well. Just an idea to toss out there.

[Dogpile]

if you look as ES.D instead of ES --- you can see the very significant 'bull trap' that occured the day after the 50-day SMA test -- there was a sharp gap down there. That gap is a crucial spot as it represents an 'excess high' and the end to that up auction and the beginning of a down auction. Now since then, we gapped down again off the employment report, another sign of 'excess'. the resulting down auction that came however was on low volume and had 'fat' profile shapes... so the downside ran out of gas. we formed a buying tail (hammer/hanging man type of thing) and auctioned up yesterday -- again on weak volume and a 'fat' profile shape. So we ended yesterday pressed up into the employment report gap (the second of the 2 gaps down). But importantly, price has not yet been accepted above that gap. Thus, we seem stuck in a range between the gaps above and the buying tail below.

[Dogpile]

outlook for tomorrow:

I mentioned that today was an 'in-between' day in the Taylor rhythm and that Thursday would likely be a 'sell-short' day. Todays action was consistent with that -- we had a day that built higher value on low volume.

More importantly, the day tested the previous excess high and this level was rejected.

The previous excess high was the 9/6 closing price -- this represented the close before the employment report gap. Price traded above 1480 today but value did not migrate there. Value migrating above 1480 would nullify 1480 as a key pivot. For now, I am treating this as a potentially bearish test of 1480. (this is based on September ES futures -- which are set to rollover this week -- december S&P's closed 1492.75 on Sep 6 2007).

Moreover, it lines up nicely with 2 up days and therefore tomorrow qualifies as a Taylor sell-short day. I will be looking to sell short tomorrow -- particularly on a test of todays high (best test would be a lower high). See attached chart for simple Taylor signal. After 2 up days -- a choppy market might reverse. We are essentially pinned up right underneath key resistance.

[Dogpile]

nobody here it seems so guess I will just talk to myself?

symmetric distribution today
closed in balance
weak volume
head & shoulder formation intraday (afternoon low)
3 consecutive up days with a weak afternoon session
looks like a short but pending retail sales date at 8:30am tomorrow

[brownsfan019]

I guess it's just you and me Dog!

Here's my analysis on the YM - http://www.traderslaboratory.com/for...html#post19144

The red spinning top @ support provided a nice profit. The ES did as well, but would have to run the #'s due to rollover.

So far, candle pattern + support level = nice profit for a 3 day trade.