Jul 192010

The ES opened already rotating between 65 and 69 which was between our 67.75 / 68.25 and 65.50 / 67 levels so we decided to wait until price moved outside the range and into a new price level to look for trading opportunities.  As 10am EST rolled around, we waited on the news and the ES sold off to yesterday’s close and sold off again through our 61.25 / 62 level before finally reaching our 58 / 59 long fade area.  After a couple of rotations, price pushed into our 58 / 59 level a second time and the institutions were buying.  However buying was not evident within the price bar.  I thought it was worth the risk for a long trade with a target 0f 61.    After entry, price started trading below the entry price, not a good sign for the trade.  After a few minutes, it broke up towards the 61 target but just did not have enough momentum to get there.  Whenever a trade makes a good attempt at a target and fails to take it out, I start looking for the exit.  Price moved down pretty fast so the exit ended up being around break even.

The ES then broke down and put in a low 4 ticks below the defined 58 / 59 level.  If the low held, it can be considered as part of the same 58 / 59 level.  After a rotation, price double bottomed and buyers stepped back in.  Institutions were net buying again.  Price moved fast and an entry long below 1059 would have been difficult.

The ES is currently working on building an acceptance area, ranging between 59 and 63.  For the rest of the day, it would be best to wait for price to break above the day’s high or low and move into a new level area before considering new trade opportunities.

 Posted by at 12:14 pm

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