Tuesday 03/23/2010 - E-Mini S&P 500 Futures Review/Analysis

In last night's post I wrote, "Given the recent strength, I'm anticipating either consolidation or break-out to the upside." -- and we got both today: consolidation followed by a break-out to new yearly highs. The morning consolidation chop was very boring to trade, so kudos to you if you sat through it and were able to take advantage of the late afternoon break-out. Looking at the 1-Minute ES/NYSE-TICK chart, we got positive divergences a few minutes prior to the break-out. We also got positive delta 10 minutes prior to the break-out, with very little selling interest in the 1164.25-1164.75 area. 1170-1170.50 is near-term resistance now. A test of the 1163-1165 wouldn't surprise me. I'm also expecting rotation in the 1170-1180 area; a breakout above that could get us to 1200s in a hurry.

ES 5-Minute Chart


ES Day Session Volume Profile Chart

E-Mini S&P 500 Futures

Tuesday 03/23/2010 - S&P 500 Futures Key Support/Resistance Levels

E-Mini S&P 500 Futures
ES is trading just a few points away from its high of year (1165.50), and we could easily test and even break through that level tomorrow. The Nasdaq (NQ) made fresh highs on the year on Monday. The Russel and Dow are also trading close to their highs on the year. There are three scenarios possible here: consolidation, break-out, break-down. Given the recent strength, I'm anticipating either consolidation or break-out to the upside. Based on the current price action, my bias is Bullish. The Bull/Bear Line in Sand is 1153.25; bias would shift to Bearish below that level. We have the Existing Home Sales data out at 9:00 AM (CT); that could be the catalyst that motivates traders to enter the market with some conviction. We are seeing some volatility re-enter the market as well. The day session range over the last two days has been 14.75 points and 15.50 points. Keep that in mind when initiating counter-trend trades, or setting targets for trend trades. Trade well!

Econ Data
Redbook at 7:55 AM (CT), Existing Home Sales at 9:00 AM (CT), Treasury Secretary Tim Geithner testifies before the House Financial Services Committee at 9:00 AM (CT)

ES - Daily Chart with Volume Profile and Key Levels

Friday 02/26/2010 - E-Mini S&P 500 Futures Review/Analysis

E-Mini S&P 500 Futures Review/Analysis
The Key Levels and the Bull/Bear Line in the Sand at 1095 provided a great "road map" that kept me on the right side of the market. We saw a rejection of the 1099 level, and acceptance of 1102 during the first 30 minute rotation. Following that, price pushed down to 1096.25 on the Existing Home Sales release, and Responsive Buyers came in and quickly rejected the unfair lows in the 1096.25-1098.25 area. From that point on, we continued to see acceptance of prices above 1100, with continuous rejection of lower prices (1100+ considered "fair" value). I'm anticipating this area to hold going into next week. A push below 1095 could result in liquidation and/or initiative selling. A break-out above 1113 could easily push price up to the mid 1120s.

Hope you all performed at your best this week! Have a great weekend!

ES 5-Minute Chart


ES 30-Min Volume Profile Chart


ES Day Session Volume Profile Chart

Friday 02/26/2010 - S&P 500 Futures Key Support/Resistance Levels

E-Mini S&P 500 Futures
After Thursday's recovery to 1100+, bias is bullish going into tomorrow. The obvious catalysts tomorrow morning include the GDP release followed by Existing Home Sales data. You can check the blog post from the previous GDP Release on 01/29/2010 for ideas on how price may react. I could write additional ideas, but it's already past 1:30 AM and Thursday's a really long day for -- plus I need to be up pretty early tomorrow so just the Key Levels will have to do. Bias is bullish above 1095, bearish below.

Econ Data
GDP at 7:30 AM (cst), Chicago PMI at 8:45 AM (cst), Consumer Sentiment at 8:55 AM (cst), and Existing Home Sales at 9:00 AM (cst)

ES - Daily Chart with Volume Profile and Key Levels

Monday 01/25/2010 - E-Mini S&P 500 Futures Review/Analysis

E-Mini S&P 500 Futures Review/Analysis
The 1101-1103 area proved to be resistance on the day. As anticipated, price remained range-bound within the Initial Balance for most of the day. Majority of the volume occurred between 1096 and 1097. The range was pretty narrow, with the day session coming in at 9.75 points and the 24-hr session totaling just 13.25 points from High to Low. Range contraction leads to range expansion and vice versa, so expect some better price action tomorrow.

ES 5-Minute Chart for 01/25/10

Monday 01/25/2010 - Key Support/Resistance Levels (S&P 500 Futures)

E-Mini S&P 500 Futures
The S&P 500 has suffered a 60+ point drop in three days; a bounce at this point should not be a surprise at all. 1086-1088 is a strong area of support, and we have the December Low at 1080.50 below that. I'm anticipating the 1080-1086 area to hold as support, and the plan is to look for Long opportunities there. At the same time, I am expecting rotation in the 1101-1103 area, and the 1109.50-1112 area and will be looking for Shorting opportunities there. Overall, I'm expecting a range-bound price action but with a bullish bias. Volatility is also coming back into the market, and the average daily range of the S&P is now around 20 points. As a result, we're also getting wider rotations, so the initial scale-out or profit target can also be increased.

Econ Data
Existing Home Sales at 9:00 AM (cst)

ES - Daily Chart with Volume Profile and Key Levels

Tuesday 12/22/2009 - S&P 500 Futures Market Review

E-Mini S&P 500 Futures
It was low volume chop day, but the key levels worked very well. The Initial Resistance Zone of 1112-1113.50 acted as resistance in the overnight Globex session, and price paused there several times. The GDP release pushed price down to 1110 and it became a swing low, and thus a key reference point (I took a Fib measurement of this swing to get some range extension targets if price reversed to the upside). Price pushed up to 1115.75 on the Existing Home Sales #, but couldn't get beyond that. You can see on the 5-min chart that price hit that level 4 times, and couldn't get through it, and it was a low-risk area to initiate a short with a tight stop. From there, we sold off the IB low, but 1110-1110.75 was support and the 1110.50 low was rejected. 1112 was previous day's IB High. I posted the 1112 level on Twitter/StockTwits several times in the afternoon (bullish above 1112, bearish below). It was a key reference point to establish a short-term bias, and served me well.

ES 5-Minute Chart for 12/22/09 Includes Overnight Globex

Key Levels & Scenarios (S&P 500 Futures) for Tuesday 12/22/2009

E-Mini S&P 500 Futures
Two important economic releases tomorrow morning: GDP at 7:30 AM (cst) and Existing Home Sales at 9:00 AM (cst). My bias is bullish above 1103 and bearish below it. ES is already trading very close to the initial resistance zone (1112-1113.50), and may even take it out overnight. Aside from the moves driven by economic news, I'm anticipating rotational price action between the support and resistance zones. Don't be afraid of the Long side; if we continue moving higher, the stops above will carry Long positions well into the black. Must be cautious on both sides though since it's a holiday week and end of the year. Thin markets can move farther than we may think.


ES - Daily Bar Chart with Volume Profile and Key Levels

Key Levels (S&P 500) for Monday 11/23/2009

E-Mini S&P 500
As @Jediphone pointed out on StockTwits, 7 of the last 8 Monday's have been bullish with an average gain of 1.28% (source: Phil's Stock World). In doing my own research, I found that the Monday after OpEx Friday was bullish in October, and the Monday of Thanksgiving week in 2008 was bullish as well. It's something to keep in mind, but of course, trades should be initiated based off what the market tells you in real-time. Existing Home Sales data out at 9:00 am (cst) tomorrow morning.

Bullish Scenario
1089 (VPOC from Friday) is near-term support. On the up side, we have near-term resistance at 1095.25. I'm bullish above 1095.25. After that, we have range extension targets in the 1098.25-1099.25 area, which could act as short-term resistance. If price gets to that area, I would anticipate a test of 1100, but that's a good area to scale out of Longs, and re-load at better prices. Above 1100, 1102.50 is a level that could offer stronger resistance and provide a rotation back to the 1099-1100 area. Above 1102.50, 1106 is strong resistance, and we have an Open Gap at 1108.50. We're currently building value in the 1094 area.

Bearish Scenario
1089 is the Volume Point of Control from Friday, and price would need to get below that level for sellers to begin taking control. 1085.25 is the next level of support, and the line in the sand for me between bullish/bearish bias. Below 1085.25, my bias shifts to bearish and shorting bounces becomes the higher probability play, IMHO. If we get below 1085.25, we'll likely test 1082.50, and quite possibly even break below it to get to that 1076-1079 area. I would expect the sell off to really accelerate if we break below 1076. 1064 has been the final bearish target for several days now.

ES - Daily Bar Chart with Volume Profile and Key Levels

Wed. 05/27/09 - Chop chop, break!

No trades today as I was busy in downtown with paperwork for the new job and didn't get back home till after market close. Doesn't look like I missed much; the morning was a chopfest. I mark up the charts even on days I don't trade in order to further my education, and to keep up with the most recent price action, so here's my marked up 5-min chart:

ES (5-Min)


Lot of econ news out tomorrow. Durable Goods Orders and Jobless Claims at 7:30 AM (central), New Home Sales at 9:00 AM.

ES (Daily) - Bears can't get overly excited based on today's action since price simply pulled back to yesterday's 50% level. I'm sticking with Bullish bias until I see a CLOSE below 875 on the Daily chart.

See One, Do One, Teach One

"See One, Do One, Teach One" - I first came across this phrase in Dr.Brett Steenbarger's book, and upon doing a quick Google search, here's a definition I found for this phrase: "A traditional format for acquiring medical skills, based on a 3-step process: visualize, perform, regurgitate". If this form of learning can be applied to something as critical and difficult as medicine, then why not apply it to trading? I bring this up because one of my friends recently asked if I could teach him how to trade, so I spent an afternoon with him going over the price action charts I post on my Blog, and then handed him a copy of Reminiscences of a Stock Operator, which he has almost finished reading. Today he came over to watch/trade the market in real-time at my place, and he performed really well! He was able to net +$112.50 in 2 hours trading the ES. Now keep in mind, today was the first time he ever saw a chart of the ES in real-time, and he got these results armed just with Reminiscences of a Stock Operator and the basics I covered with him in one afternoon (support/resistance, trend, reading price action and identifying higher-highs/higher-lows/lower-highs/lower-lows, and the definition of a candle-stick). That's IT! Going over the charts with him in real-time further enforced the trading principles in my own mind. Dr.Brett recommends saying your thoughts aloud because listening to yourself forces the mind to re-analyze the idea, and some ideas "sound" incredibly stupid once you say them aloud. Now he also placed some bad trades, which I recommended him to stay out of, but he wanted to get into them anyway, so for the sake of education (learning from mistakes), I entered him into the trades on Sim, and we promptly lost -$225.00. If we discount the two bad trades, the net profit on the day would be +$337.50.

My point is, teaching someone else how to trade will probably make you a better trader (+1 for karma, I suppose). So lets share knowledge and become better traders.

Durable Goods Orders out at 7:30 AM (central) and New Home Sales data out at 9:00 AM (central) tomorrow morning. Aside from that, the 830 level held today so that's a good sign for the bulls. I'm hoping for continued movement to the up-side.

ES 610-Tick bar Chart (Trades)


ES/$TICK (3-Min) - Gap filled by 9:03 AM (Central)


ES 15-Minute - Price above 34 and 200 EMA. 830 level held.