Monday, December 2, 2013

Pre Market Thoughts Tuesday


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:

  • 1807
  • 1801.25 
  • 1795.75
  • 1792.25
  • 1788.50

Day Trading Pre Market Thoughts  

Trend Thoughts: Trend is long with this minor pullback. Of note YM closed under the 10sma.Will be careful chasing longs up here and staying with the theme fading off support NQ has some downside open space between support levels,  may pullback the quickest with a break below Mondays Lows.Will not consider a trend change until a 2 day close below the 10sma.

S&P 500 Sectors: Strong Sectors: XLK XLV   Lagging Sectors: XLU and XLP Notes:

 

True Range Thoughts ES:  8-12, many reports out Wednesday which could keep the range in check today.

Reports: none

Special Day Thoughts, Trading Day of the Month: 2nd day of the month favors longs

Gap Fill Thoughts:   Up Gap: I don't see anything compelling, May consider if overnight high is below 1805 and opening near resistance with room to 1801. Need to see overnight action Down Gap: If price is above the S1 pivot and considered support. Notes: If sitting at support/resistance check pre-market to see if price is considered support or Resistance. 

Flat Open Thoughts:  No trade

Gap and Go Thoughts: Up Gap: Solid up gap over the PP pivot with support may consider going long at the open. To many traders chomping on the bit to short. Still need to see overnight action Down Gap: Alot of support underneath. I would pass at the open for a gap and go short. Better to pass and let the first 30 minutes play out.  Notes: none

Thoughts on Long or Short Setups after 30 Minutes of Trading

(Always evaluate the market after 30 minutes unless noted)

LONGS

Breakout thoughts for a 15, 30 or 60 minute breakout: Will consider BO's or pullbacks with a gap up that holds its gap or gap down and a strong bounce 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 unless extremely bearish for 30 minutes below last weeks low with volume. Extremely bearish is breaking support levels with a long red 30 minute nasty down bar with volume. If that scenario unfolds then I may consider shorting pullbacks on light volume provided the bounce is not coming off support with strong volume. Indexes must be working together Notes: Best not short with the market trend up

Fading Short
thoughts:
May consider fading at S1/yesterday high area if all 3 indexes at support and the ES has had a range of at least 8 points. 


If price is trading solidly below last weeks lows, at resistance with low volume and a range over 8 points may consider as well. Trend is still up. Will not fade a bounce off support with strong volume. Always want to short with the indexes at resistance and monitoring the components of the indexes to see if they are in agreement. Notes: Always mark Support/Resistance and confluence zones that could be used for targets, fading and breakout/breakdowns.

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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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