Monday, December 30, 2013

Pre Market Thoughts Tuesday





ES Five Day 30 minute chart

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 Levels and Trend Lines I will be paying attention to when considering a trade: Does not include overnight highs and lows.

  • 1833.50
  • 1831.25
  • 1829.50
  • 1823.25
  • 1818
  • 1814.25 
  • 1805

Day Trading Pre Market Thoughts  

Trend Thoughts: Short term is neutral with bullish longer trend. Targeting pullbacks to the long side. Markets close early, look for slow volume day. May take the day off.

S&P 500 Sectors: Strong Sectors: XLB    Lagging Sectors: XLU  Notes: XLE got hit hard today.

   
Special Day Thoughts, Trading Day of the Month: 
  •  MARKETS CLOSE EARLY 1:00PMest.
  • ES and YM in a NR7 and NQ had a false up day.
  • Day: 20th and last trading day, historically can favor end of month buying. NQ down 11 of past 13 years on last day of the month.
  • Month: December ES is historical the best month for longs. 
  • * info taken from Stock Market Almanac, provided more for fun than for a day trading bias 

Reports: 10:00AM consumer confidence. 

Gap Fill Thoughts: 
  • Up Gap: May consider the fade near 1837.75.  
  • Down Gap: Will consider fading a down gap near 1829.25 and 1831.25 Notes: If sitting at support or resistance check pre-market to see if price is considered support or Resistance.

Flat Open:  pass

Gap and Go Thoughts: 

  • Up Gap: Short day wont chase, would be tempted to take with a gap up over 1838. Best to pass.  
  • Down Gap: Short day wont chase Notes: none

Long/Short Setups after 15-30 minutes

LONGS

Breakout location thoughts for a 15, 30 or 60 minute:  Will consider BO's or pullbacks on a down gap coming strong off support with room to Fridays high. Will not chase any other breakouts, Will consider pullbacks to support if trading above 1838 and is support.  Notes:
 

Fading Long thoughts: 
  • Major points to  target 1831.25 and 1829.50 at there first test.
  • Notes: Prefer a 5 point plus move into the location

SHORTS

Breakdown location thoughts for a 15, 30 or 60 minute: Will pass on breakdowns, may consider short pullbacks with a gap below Mondays Low that holds below the low.  Notes:    

Fading Short
thoughts:
 
  • Will pass last day with the short day and up trend.
  •  Notes: Prefer a a 5 point plus move into the location

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