Aug 292013
 

trade_130829

Tensions over a US or UN strike against Syria subsided some overnight as the UN security council and UK parliament have slowed things down.  The thought coming into this morning’s economic data announcements (GDP and Jobless Claims) was that maybe focus would shift back to the numbers.  GDP handily beat expectations while claims inched up a little.  The GDP number supports Fed QE tapering, and the ES started selling off on the news into the DTG 29.25 level.  After a few minutes, the ES started putting in a bottom and a pre-market long opportunity unfolded.  I was hoping for the sake of the example trade that the ES would make another test the lows after the cash open, but it never did.  As I posted in chat, the only thing in the way from the bulls retesting the overnight high way up at 38.75 was the yesterday close and pivot point area around 32.25.  The area did provide some resistance, but with the backdrop of eased Syrian tensions, the bulls started taking control, sending price to the overnight high area which was 11 ES points in 25 minutes; a very nice move…

The overnight high area had the R1 pivot right above and did provide resistance for the next 30 minutes, but as I warned in chat; the longer price consolidates under the overnight high, the greater the odds of price breaking higher.  A couple fake out short opportunities unfolded in the overnight high area (i.e. the DTG 37.75 level), but the bears never got any traction in that area so any short from that level would have taken a loss.  The overnight high area was a prime area to be long which I had posted in my morning chat commentary.  The ES had been consolidating for 2 days and a move above the overnight high could easily have the ES retesting the 44.25 highs.  Unfortunately an order flow entry did not unfold.  The long opportunity could only be captured by trading the breakout around 40.

Thus on the breakout, the bulls took price into the DTG 40.25 level and my 43.50 high frame.  Having traded long from the pre-market low opportunity, my trading was over for the day and other commitments pulled my away from my screens for a few hours.  However, looking at the charts, I can see there were a couple short order flow opportunities from the DTG 40.25 level in the late morning.  These are today’s example order flow opportunities… 

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trade_130829b

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