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Home / Futures Blog / Employment Report Day Trade in eMini Futures

Employment Report Day Trade in eMini Futures

July 8, 2016 by Scott Hoffman

Report releases often create conditions where a market makes a large move in a short amount of time- a breakout trade. Yesterday I wrote about a breakout trade in crude oil (read it HERE) after the weekly inventory report. Today we had a trade opportunity in the stock index futures after the release of the monthly employment report.

In last night’s edition of Swing Trader’s Insight I labeled all the stock index futures as having breakout setups. We know to look for potential breakout trades because of the range contraction seen on Thursday and doji bars in the S&P and Russell futures.

It was logical to anticipate a breakout move after the employment report release because traders tend to not commit to a side before a major report (as evidenced by range contraction and lack of directional movement) . Then after the report release, traders often move the market (buy at higher prices or sell at lower prices) to reflect a new idea of the market’s “fair value”.

ESU daily July 8

Today’s June employment report was viewed as bullish for equities, and they rallied above the Thursday and weekly high, peaking at 2110.00 shortly after the 7:30 AM release and then tailing off into the 8:30 open.

When trading stock indices, I normally wait for the 8:30 open; I find that waiting means I miss some occasional whipsaw moves, and there are often additional entry opportunities after the open.

ESU intraday July 8

We did get that entry opportunity this morning. After the 8:30 open, the September eMinis traded back below the weekly high, making a short term double bottom at 2103.50. The rally resumed, clearing the 2104.75 weekly high a few minutes later, which triggered our first long entry. About 15 minutes later it traded above the 2110.00 pre-open high, giving a second entry opportunity. (With breakout trades we want to trade in the direction of momentum, assuming the market will continue to move in the direction of momentum.)

In this case, the market continued higher. The previous contract high of 2119.50 was reached in the early afternoon, and it was eventually squeezed higher, making a new high of 2125.50 about an hour later.

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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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Risk Disclosure

This material is conveyed as a solicitation for entering into a derivatives transaction.

This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.

Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.

Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.

You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.

Filed Under: Swing Trader's Insight

About Scott Hoffman

Scott graduated from the University of Chicago in 1986 with a degree in Economics. After graduation, Scott worked on the floor of the Chicago Mercantile Exchange then moved upstairs, serving as the personal broker to a former chairman of the Chicago Board of Trade. There, he worked as a broker and margin manager, starting up the firm’s full service brokerage division.

Today, Scott serves as an educator and mentor for new traders, and as a trading partner and ally for experienced traders. The breadth and depth of Scott’s knowledge make him the “go to guy” for both retail and institutional traders.

Scott also publishes two futures advisories, Swing Trader’s Insight and Trade or Fade. He also writes the futures trading blog at www.futuresinsightblog.com. Scott has written articles for a number of futures publications and has done numerous futures trading seminars, including seminars for both the CBOT and CME.

Scott offers his customers the knowledge he has gained from his more than 25 years of experience in the futures business. Scott is accepting new clients at this time.

Scott lives in suburban Chicago with his wife and three children. In his free time he enjoys coaching his children’s sports and various other athletic activities.

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Risk Disclosure

This material is conveyed as a solicitation for entering into a derivatives transaction.

This material has been prepared by a Daniels Trading broker who provides research market commentary and trade recommendations as part of his or her solicitation for accounts and solicitation for trades; however, Daniels Trading does not maintain a research department as defined in CFTC Rule 1.71. Daniels Trading, its principals, brokers and employees may trade in derivatives for their own accounts or for the accounts of others. Due to various factors (such as risk tolerance, margin requirements, trading objectives, short term vs. long term strategies, technical vs. fundamental market analysis, and other factors) such trading may result in the initiation or liquidation of positions that are different from or contrary to the opinions and recommendations contained therein.

Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.

Trade recommendations and profit/loss calculations may not include commissions and fees. Please consult your broker for details based on your trading arrangement and commission setup.

You should carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. You should read the "risk disclosure" webpage accessed at www.DanielsTrading.com at the bottom of the homepage. Daniels Trading is not affiliated with nor does it endorse any third-party trading system, newsletter or other similar service. Daniels Trading does not guarantee or verify any performance claims made by such systems or service.

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