Preparing ES Emini and MES Micros Traders
To Trade In Our S&P Trading Room

Transcript

Price Action Bounce Trading System. How To Scalp ES Emini or MES Micros Futures.

Helping Futures Traders Via Our Core Strategy Academy Training Program and Futures Trading Group – The Best Emini Group IMHO.

“Welcome to the AM briefing preparing you to trade live in our E-mini trading room at Microstr Docomo. Good morning! Good morning! I slept like a baby and just made a fresh pot of coffee and hit the charts early this morning. I am just excited, so I can’t wait to trade. Although today is the day after a big move and the day before a big number, so I don’t know how much to expect today. One thing we expected yesterday was ranges and volatility with CPI, part of the trifecta of news events I talk about. So, let’s review yesterday because I think it was significant. In all honesty, I took a very nice short here and got paid well. I did it with some decent leverage and got paid well. For me, decent leverage means I did my full allotment of leverage. I typically trade my first entry with the smallest leverage, and then I try to add to my winners. I do not add to losers; I add to winners. But this time, I did my full allotment and did very well. Then, I took a full loss, but I took a full loss with 10% of my profits. I told the group I wanted to take this trade; I was greedy about my entry. I did actually two different entries in two different accounts. Because I did the same short in two different accounts, I was only going to lose 10%, and then I was most likely going to be done trading. I actually got off Zoom early, and we’re going to talk about those things.

So, as I said, we had a beautiful 30-minute level here. It grabbed that, pulled in nicely. I did very well. We opened up with a doji, indecision candle, followed by a vomit candle. That’s the reds denoting vomit candles. Then we started coming back up. On a one-minute chart here, okay, now that I’m on the one-minute chart, I’m more clear on what I did. I actually took a short here in one account and I took a short right here in another account. I believe those were my entries. I don’t believe they were up here; I believe they were right there because we were laddering down, great places for price to continue to move down and this fair value gapped through my price, not even giving me the chance for a gift to break even. And that’s your first red flag, even on a one-minute chart. If we’re not bouncing off backsides and giving you the opportunity for a gift to break even, watch out.

Now, I was small and I was risking 10% of my morning profits. If this was my very first trade, as soon as it didn’t respect my level here and didn’t respect this level here, I know, first of all, I’m looking for an opportunity to take a half loss and fully expecting to take a full loss. Just price is not respecting levels that keep price down, and that is something I’m always on the lookout for: which levels are being the most respected, which levels aren’t being respected. And then, when it was all said and done here, I told the group, I said, ‘Okay, if it rips through the next level, I’m done.’ And the reason why is because I wasn’t long. Now, one of my traders was long here; he made a 50-pointer yesterday. Congratulations, Papi, awesome trade. I wasn’t long, and when I got the fourth red candle, I said I’m out, I’m done, and I closed down Zoom. Know when not to trade because I know me, especially the old me wants to come out. Okay? And if we put you in certain environments, an old you will come out. If we put you with your old college buddies, a different you comes out, your old army or Marine buddies, a different you comes out. Well, when I start seeing this, my old me wants to short the crap out of this. Okay, you just cost me a short, you ripped my face off, and now I want to teach you a lesson. No, the market will teach you a lesson. So, my lesson has been to remove myself from the chart. So, I removed myself from the chart. And by the way, if you’re a member of my group, I did a full write-up of this last night. I encourage you to scroll up past the links this morning, and I did a walkthrough of my entire day. But I’m doing it by video here as well.

So, eight-point candles ripping my face off, I knew it’s time to get out, done, I’m out, I’m out, I’m out, I’m out. And then I come back in the afternoon, and we’re leaving a string of break levels above, and I’m like, ‘Okay, is it time for me to trade?’ We came beautifully, this was the opening, this was the RTH halfback, we came here. I was fully expecting us to come further down though, is what I was expecting. But boy, the Bulls are strong, the Bulls are in town, baby, the Bulls are winning. And so, in here, not getting great level development, we start fair value gapping up, and I went, ‘Okay, long game is on.’ I missed this long right here by three ticks, if I remember, and I was like, ‘Seriously?’ And then it goes without me. It’s sloppy, it’s ugly, but it behaved in a way that it would have kept me in the trade and then this would have gotten me out, of course. So, in here, I did a couple longs, I did a couple shorts, it was tiny, nothing. And if you looked at my profit chart yesterday, so before this happened, I did a couple trades, but basically, it went up and then the rest of the day did this. So, my entire afternoon was really for nothing. I added nothing, I lost nothing, whatever. And in fact, you know, I guess if I’m to be honest, it went up, I took that one little loss, and then it did this. I guess that’s exactly what the P&L chart looked like. So, it is what it is. I’m happy with myself for just taking a 10% loss, a full loss. No, there’s no way around it, it happens. Then, four eight-point candles in my face, get done. And I told the group, right in here, on that third eight-point candle, guys, I would be done. Walk. If I’d have taken my own advice, how many times do we say that? But in our system, when there’s the third eight-point candle, it’s usually a great idea to stop trading. If I had followed my own eight-point candle rule, which is what, if you’re a member of my group, eight-point candle rule, answer that to yourself. What’s the eight-point candle rule? When can you start trading again? When price bounces off two levels. Had I followed that advice, and I can’t tell you how critical that is, I was just up so nicely. Perhaps I was having some overconfidence maybe, but I still took a level. I took a legit level, and it was a legit loss. Oh well, we do not have very many legit losses in our system. When you get one, you just take it and you move on. It’s okay. But if I would have said up eight-point candle, we got to bounce off two newly created levels, it would have saved me from the loss, and I might have had a different set of eyes to be able to find a long in this area. But I didn’t have that set of eyes, so I knew it was time to walk. Know when it’s time to walk.

Now, I wish I would have taken the whole day off, but I was up nicely. I knew I was going to bet small. I was literally doing single little contracts here. You weren’t going to hurt me. The market was not going to hurt me. So, there’s that. Okay, so today’s the day after a big move with PPI tomorrow. I just expect complex price action. I also know the Bulls are in control. There’s my daily trend line. We’re obviously still above it, targeting all-time highs. We’re not that far away. Make sure you have your all-time high in there. And our market is at the all-time high. How are we not going to get that? I don’t know. I really believe that we are going to get that.

So, news drivers today, we got some crude oil, which, you know, may or may not have any effect. I think that’s after my quitting time. Tomorrow’s PPI, so this is kind of a sandwich day in between CPI and PPI, so we’ll see what that brings. What’s happened overnight? Well, we got Asia here, and London is stacked on top. London couldn’t even take the liquidity here. Bulls, bulls, bulls. And in fact, I was telling my group in here, and all honesty, this is all bullish. CPI candle couldn’t even take out Friday’s low or Monday’s low. Couldn’t even take out Monday’s low. And I was telling them, I said, ‘That’s bullish.’ Although I made money off that short there and then I lost money on a short. And I should have been following my eight-point candle rule and I would have been long. I wouldn’t have had 50 points like Papi. I wouldn’t have gotten at the very bottom there, but that’s okay.

So, London is stacking on top of Asia, took out the RTH high, and it’s no big deal. But what’s the biggest magnet of all? That all-time high there. We go. Okay, strong levels. So, my first strong levels here, the ranges. The top of this one, one’s about 1325, the bottom of this one is about 12. So, 13 25, I’m going to say, and 12. This little range, I’m calling this the bull-bear range, 0750 to 0650. Calling this the bull-bear range. Easily come down here, tap this area, ladder back up. Certainly, the Bulls are still in control. And I’m not saying the Bears control, but it would be watch out below. This could be a… I could have easily said watch out below here or careful with longs below is really kind of what I mean by the bull zone. Longs up here, you can short underneath here. You can be short on the way to it, but I would be careful with longs underneath here is what I might have, should have said more clearly. Careful with longs below here. And then I have a single level here at 9550. And I’m going to give you one more here. Looks like 7425. 7425. So, put those on your chart. This is the RTH high, as I said, we’ve taken it, we couldn’t even take the Asia low, we’re laddering back with a vengeance. Bulls are in control. Longs are flat is the play. If I was trading right this moment. If you’d like to trade with us live, check us out at microstrader.com. Stay green, my friends, and to learn more about our group, go to microstrader.com.”