Today the eMini NASDAQ futures were on the Sell day of the Taylor Trading cycle (it was a Buy day if you use a strict day by day account). Regardless of which day it was on, early weakness represented a good buying opportunity.
The Naz had a huge selloff on Friday, breaking out of the sideways channel. It did manage to recover some late Friday; this recovery led me to label it a Taylor Trading Sell day, viewing Friday’s recovery as a de facto Buy day. If you stayed with a strict TTT cycle count today would be a Buy day. Regardless, the ROC indicator (bottom panel of the chart) was on a buy signal, giving some confidence in a potential buy.
For a TTT Buy day we use the previous day low as our reference price; we would look for an initial move below that level as a signal to look for a potential buy; we would then look to go long when the market rose back above our reference price.
The 8:30 AM open was 5687.00; the market quickly moved lower from there. It broker below the Friday low around 8:35, making a low around 8:45 before turning back up. A rally ensued, and our long trade got triggered around 9 AM.
This was followed by a sharp morning rally, reaching a session high of 5716.75, a rally of 56.50 points from our reference price. Trading turned choppier from there. 5675 was the midpoint of today’s rally; I like to use 50% retracements to gauge whether a market is likely to reverse (rally in this case or continue in the direction it had been heading (lower, in this case). 5675 ended up holding as support and the market trended higher over the afternoon
Essential Guide for Futures Swing Trading
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