Many trade opportunities occur near key areas of interest that the market likes to test. This afternoon two areas of interest which the market tested were the 0930 ET open and yesterday's high.
The market tested the 0930 ET open several times midday. It was not until just before 1400 ET that the market traded above this line and stayed. As the $TICK went through its usual 10 to 15 minute cycle, the market refused to trade below this line. Once the $TICK was finished its down cycle, the market took a bounce to the upside.
On testing yesterday's high, we got a nice $TICK bearish divergence allowing the market to trade back down.
Charles
Hi Charles
ReplyDeleteVery interesting updates. I am still trying to figure out your particular approach to trading the ES. Is is possible to post a few examples of how you trade just like Dr Steenbarger?
Thanks
Macro
Hi John,
ReplyDeleteI'm not exactly sure how Dr. Steenbarger trades. However, what I try to do is capture the third wave of a three-wave move.
When the market moves, it tends to first make an initial Swing Wave, followed by a correction wave (50 to 63% correction), and then a final Impulse Wave. I try to capture that final Impulse Wave. An example in this afternoon's chart is where I have the up arrow with the comment that the market refused to go down. That is the wave that I try to capture.
This is a Linda Raschke type of trade.
Charles