Doug Green

It's Friday on my first week of trade blogging. It's been a very light volume week with little to no pro activity. We're at year-end highs and I'm speculating that people are nervous and unwilling to take risk. I expect more of the same today, and even less of it because it's Friday. For the mid-term I think we'll continue to meander higher. I've read somewhere 1160 as a target for the ES, with a potential strong reversal there.

One trade pre-market for a 5 tick loss. One trade after market open for a 2 tick loss. Down 9 ticks for the week.

I'll add charts later today or this weekend.

1. Nothing early, ABC series over "S" on all charts, no clear mx or macd direction on most charts, waiting until 8:30am unemployment news...
2. Around 8:25am we start the pre-news run-up, but still indecisive. By 8:28am it gets stuck at a 1:1. I'll sometimes take a risk pre-news and go counter to the run-up, especially at some key area like the 1:1 at 1139, but just as I was typing about it, the bottom dropped out. Darn, missed it :(
   • I call this a "news" trade. Look for a pre-news run-up, and for it to get stuck at an area. Be sure to use a stop. These are risky trades. But the risk-reward I try for is a risk of 4 ticks and a target of 16 ticks. You'll be successful less than 50% of the time, because it will frequently stop you out as people first misinterpret what they heard, and then run on down. But with a 4-1 reward-risk ratio, you only need to win 25% of the time to be ahead.
3. At 8:30am we have lower X's everywhere. I considered looking for an A-B sequence on the long term charts, but notice that the big triggers on both long term charts are still way above us, and there's no good support for the B long.
4. At 8:31am I then considered the F long on the 233 and the B long on the 288, both of which are inside the big triggers and also near a zsr and their projections. B long at 1134 as the small triggers rolled on the short term charts would of been a descent risk. But I talked myself out of this by looking at the long term macd and mx which are all red. I'll wait and see if by the time the F forms on the 288, if the long term trends have changed. Waiting...
5. At 8:37am the C-S on the 233 and the A- form upper macd divergence. It looks like the B on the 288 isn't going to hold and we'll get either a BB or another X. It turned out to be another X.
6. Looks like we're heading down for a bit, all trends are down. The only trade is to look for pullbacks to go short. This is a difficult trade to hit because you never have really great reversal areas to sell. One option is to sell the balance line. Another option is to sell key areas, such as a zsr. We have one at 1132.50 which is a potential short, on the high side of the big triggers and with the small timeframe balance lines 2-3 ticks above.
7. At 8:43am we run into that potential zsr short at 1132.50. I go short with a 5 tick stop which is 2 ticks above the 1:1 at 1133.25. The short term triggers are giving me some concern. It ran against me quickly, I had an opportunity to close out with a 2 tick loss, but hesitated, and took a 5 tick loss.
   • I should be trading the short term charts, and should of stuck to the A-B setups, I know that these A shorts are difficult. With Better trade management, I could of gotten out with only a 2 tick loss, but I really expected it to turn at that 1:1.
   • After market analysis of the 233 chart, shows the small triggers are coming through the big triggers circled, warning against this short and actually signaling a long. Also notice that the rectangle showing that a few bars before I went long, the bob-cob state of the lower balance line release, somewhat negating or decreasing the expecation for the bounce back down.
8. At 8:52am things have slowed down some. Back to looking for an A-B on the long term charts, which won't happen until the open now waiting...
9. Back at the open, all long term charts are up, and we already have our B pivot, small triggers are coming through big triggers on long term charts. I really should of gone long earlier, but I'm going to try long here, filled at 1135.25 with a 6 tick stop. I didn't like the way the X formed on the short term chart, we're hitting resistance at the A-A on the long term charts, and triggers started to turn. So I closed for a 2 tick loss.
10. I'm going to try one more trade today, but look for it on the short term chart. The long term charts have been giving false leads all week.
11. At 9:39am we come down and get lower extremes on short term charts. This is actually a good place to go long on short term chart, zsr at 1132.50 with lower X and 1:1. But I should of placed my order on the 1:1 and it's a little late now. I'm waiting for an A-B setup on the short term charts.
12. At 9:42am we got another lower X on the 233 with macd divergence and we bounced off it quickly. This was an opportunity to go long at that previous 1:1 level, but I hesitated
13. At 9:47am I should go long right now, but I'm gun shy. The price was 1133.50. We had just come off a B pivot on the 233 and was bouncing around the midband. The small triggers we're coming through the big triggers on the 288. Not a perfect area, but a good area. Trading is psychological. Since I couldn't pull the trigger at an area I thought reasonably good, I'm quiting for the day. I expect slow choppy trading the rest of the day. We've already had quite a bit of macd divergence too, so I don't think we'll be able to trust our macd trends.