Today’s Bullish And Bearish Zones

Pre-market futures are unchanged to
slightly red as we approach the opening bell.
Still in the grips of light volume
and drifty, spiky tapes when program trades kick in. We predict and expect more
of the same until sometime in September, with occasional trend days possible.

ES (+$50 per index point)

S&P 500 gave a buy signal near 1224 that went
for an easy +6pts before topping out and dropping -13pts from highs to lows. The
remainder of that session was spent coiling sideways in a 4pt roll.

Today’s opening zones of bias are bullish above
1226 and bearish below 1219. Several days of sideways churn since last week
should be resolved in a session or two coming soon. We are due for at least one
directional push, whether it lasts or not remains to be seen.

NQ (+$20 per index point)

Nasdaq 100 is bullish above 1586, bearish below
1573 on a general basis. Yesterday’s pop, drop and lift mirrored the ES
identically. Three yards and a cloud of dust in football vernacular, decent
intraday trading action but not easy to catch.

YM (+$5 per index point)

Dow Industrial futures are bullish above 10610
and bearish below 10550 today. One series of sell program events midday was all
the action in this symbol and the two above, with little wiggles before and aft.

ER (+$100 per index point)

Russell 2000 futures showed where the momentum
crowd continues to play: small stocks. A quick pop and similar midday drop was
perfectly reversed as buying pressed back to highs of the day. This one spent
most of its time in yesterday’s buy zone marked in Monday’s session post.

Bullish above 658+ and bearish below 654.50 is
the overall roadmap for today.

{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}

Thought Of The Day

I received an email from an S&P trader who softly chided me for
speaking of intraday swing trading to hold for larger gains than general
scalping efforts. This trader is a veteran, and commonly works 100-lot ES orders
for +0.5pt to +1.5pt profit targets by his admission. Trading a 100-lot in the
ES for +$37.50 per equals +$3,750 (less commissions) on that trade.

IF that feat can be accomplished a few
times per day while avoiding numerous losses along the way, that’s great! I do
know for a fact that scalping tight profits = stops in this manner is the most
difficult trading feat to accomplish. Common logic makes it seem like picking
off +2pts out of an 8pt swing would be easiest trading of all. What logic
doesn’t account for is the number of losing trades usually taken along the way.
The finer we drill down any attempted feat, the more precise all actions must
equally be. A good scalper must be great at picking entries and exits along the

By the same token, ES gave a buy signal at 1224
and spiked right to 1231 in the early morning yesterday. A 100-lot traded from
1224.25 to 1230.25 would likewise yield +6pts or +$300 per contract. If my math
serves me right, that would be +$30,000 (less commissions) on a 100-lot ES
trade. Go change your sweat-soaked shirt from staying in the trade, enjoy a
leisurely breakfast and have a nice day.

Quite a difference in results from scalping
versus intraday swing trading. Swing trading demands less effort, less stress,
less need to be hyper-active, frenetic and all keyed up versus scalping
attempts. Intraday swing trading still involves all of the factors listed above,
but to a much lesser degree. Easier on the central nervous system, at least for
that’s true me.

No method or system of trading is easy: our
profession is infinitely harder to succeed in than most would admit or purport.
In my opinion, one must be a good intraday swing trader before success at
scalping is possible. The reverse process is a proverbial cart before horse,
which never pushes very well uphill.

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.