The Best Tactic For This Morning’s Trading
Premarket futures are solid green
following their erratic path across the charts thru yesterday’s FOMC event. An
afternoon swoon quickly retraced back toward midline values where price action
flat-lined in the morning. Market bulls still have control of these charts,
until proven otherwise.
ES (+$50 per index point)
S&P 500 traded sideways into the FOMC report
and gyrated thru a 7pt wide roll from there to the closing bell. A scalper’s
session only, and not an easy one to trade profitably for anybody.
Wednesday’s neutral zone lies between 1233
support and 1231 resistance. Bullish above, bearish below is the general concept
here.
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NQ (+$20 per index point)
Nasdaq 100 painted a very similar chart, albeit
thru a minutiae 12pt ($240 per contract) total range. Tomorrow’s bullish zone
lies above 1606, bearish zone below 1601. Eventually the Nazz 100 will post a
40pt intraday move, one direction or the other. For now, tech players are
chasing oil futures and Chinese internet IPOs.
YM (+$5 per index point)
Dow Industrial futures made two passes thru
Nowheresville as well today. Wednesday’s zones of action are bullish above 10620
and bearish below 10600, generally speaking.
ER (+$100 per index point)
Russell 2000 futures chopped their daily pivot
point to pieces, a rather rare happenstance that happened in real time today.
Bullish above 663 and bearish below 661 is our overall roadmap for next session
ahead.Â
{Price levels posted in charts above are
compiled from a number of different measurements. Over the course of time we
will see these varying levels magnetize = repel price action consistently}
Email Of The Day
Each day I’ll answer one (or two) emails from TM readers inside this
section. Today’s question is, “Do we use cash session or all sessions data when
calculating pivot points, etc.”
I personally use cash session charts only for
all trade decisions, period. I do not trade the Globex session at all, quit that
when volatility dried up and blew away. I’m sure there will come plenty of times
when Globex trading offers dynamic movement on a regular basis again, but that
does not regularly happen right now.
Even during big overnight events like the July
7th bombing in England, cash session charts worked much better for predicting
price action. Our method of trading in the cash charts signaled early shorts off
the open and mid-morning longs from just above session lows, which both worked
for very big profits. By comparison, the Globex settings in same charts signaled
buy setups right off the cash session bell, which were failed signals the first
few times.
I’ve seen this pattern repeat itself so many
times thru the years that I only trade cash session chart settings from 9:30am
thru 4:15pm EST. Keep in mind that my style of trading is not trying to scalp a
point or two here & there. I shoot for intraday swing trades targeting the bulk
of a session’s range or ranges. Professional scalpers (all other scalpers
usually lose money net-net) may prefer the Globex charts for their extremely
difficult profession, but not me.
Hope this helps!
Buy Bias
August may indeed become increasingly difficult to trade as the month wears on.
I’ll reserve judgment on that for now. Today has gap & go upside potential, and
buying any dips in the early going have initial bias. Only if the hidden “magic
pivot” (not the daily pivot point value) gets broken will we switch to the short
side from there.
Trade To Win
Austin P
(free pivot point calculator, much more inside)
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.