I came into this morning thinking today was the day the stock markets where going to push to new highs as I wrote in chat this morning “It was last Friday when the bulls were able to push through to multi-year highs. This week, price is positioned much closer to the highs which could enable the bulls to push price even further. They’ll be looking for any excuse to do so. The trade number of any ‘little better’ news out of Europe could fuel a breakout. The markets have already shown their resiliency by bouncing back after Draghi’s comments yesterday. So we’ve already had our short-term selloff and now I think the bulls will want to test the top. If they can’t create a breakout, it could be a quiet day.”
Today was also a unique situation where trading could dry up as the day wears on as I also posted in chat: “Also underpinning the US stock markets today is a huge winter storm that could dump a couple feet of snow on areas of the NE. Traders may leave early which could result in a slow and quiet afternoon.”
Thus, I wanted to be long and I wanted to be long early, before the market volatility might slow down. I didn’t need a entry pattern and as I posted in chat, I thought 1511 would be tested and most likely break. For the sake of the DTG membership, I was hoping a nice order flow opportunity would unfold for a long, but unfortunately that did not happen. The ES broke through to multi-year highs to above the R1 pivot at 1512.50 before it met with resistance. Several short order flow opportunities unfolded as price tried to move higher. Today’s example trade opportunities are unique in that the Market Context did not support short trade opportunities (which I warned about in chat). I explain the market context in the annotated chart below.
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