Thursday, November 14, 2013

Pre Market Thoughts Friday


ES and NQ Five Day 30 minute charts
 ES PRE MARKET THOUGHTS
This a sample of how I do my market preparation. The night before I form a hypothesis of how I will approach the day if the market gaps up or down. Preparing the night before takes out all the emotion of possibly considering a trade when the markets open. 

White Lines show the ES Price Level areas I will be paying attention to when considering a trade:
  • 1780.25
  • 1771.75
  • 1769
  • 1764.25
  • 1753
Day Trading Pre Market Thoughts
Trend Thoughts: Bulls stay in charge and 1800 is within 11 points.  Will continue to favor going long. Don't fight the trend, short at your own risk. 

Trading Day of the Month: Day 11

Reports: none

Special Day or Thoughts: 2nd Wide range green bar and sitting at top of 60 minute 10 day. Odds are against chasing

Gap Fill Thoughts:   Up Gap: If price is below the R1 Pivot and considered resistance will consider the short. Will use one of my confirmation entries. Down Gap: If price is above the the S1 pivot or above 3400 on the NQ will consider the long at the open. Notes: If sitting at support/resistance check pre-market to see if price is considered support or Resistance. 

Gap and Go Thoughts: Up Gap: A flat open may consider going long, will not chase any gaps up. Down Gap: Will consider a large gap down under the lows of yesterday and lows price point can be considered support. Will keep an eye on support below and pass if support is in the way for an exit goal. I want the indexes in agreement or pass.  Notes: none

Thoughts on Long or Short Setups after the first 30 Minutes of Trading
(Always evaluate market after 30 minutes unless noted)

LONGS
Breakout thoughts for a 15, 30 or 60 minute breakout: Will not chase on a gap up, that stays up and is trading above yesterdays highs after 30 minutes. May consider a BO or pullbacks with a flat or modest down gap with yesterdays highs or R1 pivot as a target. Will consider Bo's or pullbacks with a large down gap that has traded bullish off support. Notes:

Fading Long thoughts: In staying with the trend looking for fades off support (false breakdowns) near the price points stated above. Minimum 30 minute wait. As always don't fade run away trains if bearish early, let the run play out. Always want to go long with the indexes at support and monitoring the components of the indexes to see if they are in agreement. Notes:

SHORTS
Breakdown thoughts for a 15, 30 or 60 minute breakdown:  Will not consider any breakdowns. If extremely bearish early on, breaking support levels with a red 30 minute nasty down bar, then I may consider shorting pullbacks on light volume and that are not coming off support with strong volume. Indexes must be working together Notes: Best not short with the market trend up

Fading Short thoughts: The indexes gap up will consider a fade near the R1 or R2 pivot and possible 1800 if hit early on. Otherwise will not fade short with the trend up. I want the 3 indexes in agreement. Always want to short with the indexes at resistance and monitoring the components of the indexes to see if they are in agreement. Notes: none 

Always mark Support/Resistance and confluence zones that could be used for targets, fading and breakout/breakdowns.

* You don't have to trade everyday. If the conditions don't feel right or if you're unsure of the current days trading environment then PASS on the trade. Missed money is better than lost money.  Day trading and the stock market is not a "war" that you must win at all cost. Trading should be fun, wait for only the good setups. Follow your rules, stick to your stops, and know that everyday the market presents a new chess board.

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Disclaimer

I DO NOT MAKE RECOMMENDATIONS TO BUY OR SELL SECURITIES - I JUST POST TRADES I MAKE OR FIT THE RULES OF MY TRADING PLAN ON A DAILY BASIS. DO YOUR OWN DUE DILIGENCE - YOU ARE RESPONSIBLE FOR YOUR TRADES, INVESTMENTS, AND DECISIONS! ALL CHARTS COURTESY OF TRADESTATION, SCHWAb & TD AMERITRADE