Earlier this morning I was watching the eMini S&P futures- after yesterday’s big selloff, the Taylor Trading Technique has us looking for a Buy day today. However, the stock market was trending lower this morning and the TTT has us go long only when the market is moving higher, so there wasn’t anything to do there.
This is a major reason I cover as many markets as I do for Swing Trader’s Insight (there are 23 on the advisory, and I look at a few others as well.) . If there’s no trade for a given market, I can look for opportunities elsewhere. Early in the morning the TTT didn’t have signals for the eMinis, so I concentrated on other markets.
The gold futures were one market I was watching. After making a new yearly low early Monday, it staged a strong rally later in Monday’s session and saw upside follow through on Tuesday. This two day advance meant we would anticipate a Taylor Trading Technique Sell Short day for Wednesday.
Today’s TTT signal was complicated a bit by the fact that Tuesday was an NR4 day, which is a pattern that often portends a breakout move. Gold had a breakout rally last night, as the move above the Tuesday high saw an extension of the up move.
However, as we moved into the morning the rally had faded, and by the 8:30 stock market open it started trending lower. The lower high (made just after 8:30) and the downside momentum meant we could start to look for the Taylor Trading Technique Sell Short day signal- to short the market when it fell below the previous day high.
That level, 1214.10, was taken out around 9:10 AM; this triggered our short sale. The previous pit hours low of 1217.50 (the maroon line on the chart above) would be a good level for an initial stop loss. It then made a series of lower highs and lower lows, making a session low of 1205.10 by 11:20 AM. At this point (shortly after Noon CT) it is still making lower highs, so more patient traders could use that as evidence to continue to hold shorts.
Essential Guide for Futures Swing Trading
In this guide, experienced trader and broker Scott Hoffman explains the trading methods he uses to analyze and trade the futures markets and to publish his trade advisory, Swing Trader’s Insight.
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