Day Trading the E-mini Futures

[Day Trading the E-mini Futures]

Good morning traders!

 

Anyway, you can see that price is gradually being pressed into your support. Swing highs are lower, and lower, and lower. If price can break through and hold beneath your support, I could see it going to 1295 in the near term. It all depends on how long you want to hold the trade.

 

So, how do you plan to play this?

 

Also, this is hindsight, since I didn't have time to post it this morning, but the scenario I envisioned worked out nicely. Before the start of opening trading, I envision what I believe are the two or three most likely scenarios. My first scenario today was the Dow breaking support and auctioning down to the top of the unfilled gap, at 12359. That level also happens to be the 100% fib projection, so we have some nice confluence there.

 

This wasn't that easy to play, though. It looks simple here on the 405 min, but when we zoom down to the intraday data, you can see how there were a lot of fakeouts for a day trader. I put some numbers on the second chart. Match them up to these bullets.

 

1. This was when it seemed that my play would be fairly straightforward. We opened, auctioned up to the support from the larger chart, and immediately failed.

 

2. As you can see, however, it was not straightforward. Price made a low, then began to chop back up. This is when being a day player is nice, you can preserve some profit.

 

3. Market chops back up to support, tests, fails, tests again and fails, and auctions back towards the low. This is where it started to get tough. I was short, expecting at least a test of support, which it didn't quite give me.

 

4. Price accumulated and then broke out to the upside. At this point I began to turn bullish and looked to a gap fill. I played the retest of support and got chopped around a bit in the process. Market filled half the gap, at which point I noticed major amounts of selling in the order flow. Sellers came in in increasing numbers, absorbing the mo mo buying and gradually beating back the assault.

 

5. As prices began to turn back down, I was somewhat hesitant to jump back in short, but did so anyway with a trailing stop.

 

6. The market began to accelerate as it moved down, breaking that support yet again and auctioning to the low.

 

7. At that point, no significant buyers stepped in and the sellers pounded price through the lows. I didn't hold all the way to 12359, but I got most of it.

 

I'm not posting this to brag. I made money, but not as much as I could have or perhaps even should have because of the fakeouts and choppiness of the move. However, because I knew this was a distinct possibility for the day's action, I was able to keep my head through the chop, switch sides when it looked like I was wrong so I didn't get pounded too badly, and eventually have a nice payday.

 

I hope this helps some of the new people out there. This is what trading is. You have to be light on your feet. Creating a good plan is easy, as is making decent market calls. Trading those beliefs profitably is an entirely different story.

 

Great post for newbie like me. Especially appreciate the detailed thought processes. I'm just beginning my Futures trading education before I trade. Using paper money account, but it's less interesting. Wish I could treat it like the real deal.

[Let's talk about options]

This is my first post ever on a TL blog and I selected the options thread because I am very new to this. I have options privileges but have yet to actually trade real money. I am very comfortable with trading stocks which seem pretty straight forward vs. options.

I use TOS with TDA and have gone through all of their free options seminars, and also have Investools access and have taken their free options webcasts.

It seems that every time I start to evaluate costs, possible return, etc. the premiums for buying or selling using various strategies, the upside is so minimal (vs. risk and commissions) that it just doesn't make sense. Obviously, I am missing something in my understanding on a basic level.

I own some pretty high volume stock with heavy option trading (BMY for example).

I've got lists of strategies and when and why they are used, but it's the actual application of it and clearly understood advantages that elude me. And I am not against taking moderate risk if I understand the process.

I realize my problems may be too basic for this thread. I also know I need more education on this topic.

Any references or advice of any kind would be most appreciated.

Timo