Here’s how you can make money in a sideways market
Tuesday’s session followed the pattern
script we noted in this forum last Thursday. Historically, the session following
President’s Day weekend tends to sell off. So it did, in calm and orderly
fashion.
ES (+$50 per index point)
S&P 500 futures traded around their R1 value,
dropped thru the pivot point and into S1, bounced back to the pivot resistance
and spent the duration from noon to closing bell rolled between S1 and S2
values.
Inside those various swings, we easily booked
+9.5 points on five turns inside the live room. I wouldn’t say trading is ever
“easy” thru any session, but the signals were clear & simple for this one.
ER
(+$100 per index point)
Russell 2000 futures failed at R1, dropped to
S1, plowed thru there to S2 and buzzed both sides of that value until a slight
closing-bell lift as the vaunted “dipsters” did their thing in this bullish
pasture we call small caps.
We booked +5pts on two turns in the first hour,
then barely missed +5pt and +3pt successive shorts by a single tick each in the
room. Had potential to be a +10pt session overall, but that’s very common
potential in this most-active emini symbol.
ES (+$50 per index point)
S&P 500 posted a bearish engulfing candle to
paint yesterday’s chart. That means the candle/bar had a higher high and lower
low than previous session, and it finished in the red. This portends
continuation lower to candlestick fans. We should see at least one downside move
this morning to follow the session’s trend move lower thru most of yesterday.
ES 1280 and especially 1272 areas are probable
to have buy stops clustered there like honey bees on the first cherry blossoms
of spring. We can easily see those bright flowers, and know the bees are there.
So too will dipsters (by the thousands) be eyeing these levels in anticipation
of catching the next leg up.
ER
(+$100 per index point)
Russell 2000 also leaves a bearish engulfing
candle hanging near relative highs. Next visible support below is 712 ~ 710 zone
with 695 likely to be solid support if visited again in the near future.
Summation
Same general story, different day. Index markets continue to roll sideways in
directionless fashion. That of course is perfectly fine with intraday players: a
steady diet of price action like yesterday thru 2006 would offer obscene amounts
of profit by New Year’s next. Eventually a trend move will develop and decidedly
break, while we are perfectly content to play intraday ping pong along the way.
Expecting more of the same today, trading the clear signals as they unfold
without bias either way.
Trade To Win
Austin P
(Online video clip
tutorials…
open access)
Austin Passamonte is a full-time
professional trader who specializes in E-mini stock index futures, equity
options and commodity markets.
Mr. Passamonte’s trading approach uses proprietary chart patterns found on an
intraday basis. Austin trades privately in the Finger Lakes region of New York.