Traders and Gamblers, Emini style
I know a number of traders who would give credibility to what most of my friends and relatives think about me: “Trading is for gamblers”.
Is it really?
That, of course, is a rhetorical question, and subject to interpretation, much like the market.
Some people may have difficulty in following my calls, or Mr Hamzei’s (brilliant man), or anyone Else’s.
That’s because they don’t OWN the system. By that I mean they are not intimate with it. They haven’t spent 15 years + studying, analyzing, winning, losing and getting kicked in the teeth by the market gyrations.
Having mechanical indicators that help us is one thing; having intuition is another.
Resistance at yesterday’s 902.5 area means that “general neighborhood”; no guarantee it will work at all. If you were patient, and waited for a reversal time and place, then that was a great risk/reward opportunity. The bulls were already stretched, and needed to take profits. The 10 minute chart had resistance as well as the 5 minute chart, adding more power to the thought.
Is that gambling? Sure. Is it a reasonable trade? You tell me.
The 86 was called as all out. That means no trailers, done. Primary trade is over. Respect the 85. Then we announced the Angel at 89.75, which means support attempting from there.
If you had just scored 15+ points, wouldn’t you want to capture profits? So the odds shift from staying for a point or two, or reversing and risking a few of your winnings for the bounce. 92.5 was the closing marker, needed breaking, and then tests were for vwap, pivot and the 900 open RTH. We never know how far bounces will go, so lighten up as we approach resistance.
30 Minute view was posted for the lunch fade, and shorts who were thinking 85 82 again needed reminding that the 91 92 area is first support above the Angel. Capturing profits and going to the sidelines is not a bad thing to do; it is what separates traders from gamblers.
The inverted head and shoulders formation was obvious from the 10 min chart (hindsight). That’s why the line is there, to remind me of it’s importance. The rip snortin’ bounce then tested the breakdown from yesterday.
As the price moved into that higher zone, you may remember my comment: “I am looking for traders to take profits after 2:30.”
I like to short those bounces, because they are fast and powerful moves if I catch the right entry.
Longs were valid too, as the market was above the 97.25 pivot.
We had the 906 area as T1, and 11.5 as T2 today.
Note the volume spike on the 86 exit, and the divergence on stochastics.
The market ebbs and flows. In my mind I selected 905 and 885 as round numbers for my thinking today.
Not perfect, but not too bad either.