Both the eMini S&Ps and the soybeans had breakout setups today. The soybeans made a modest move. The eMinis were a bigger mover; I missed the early entry but found a decent trade this afternoon.
Soybeans had a breakout setup after yesterday’s doji bar and NR4 formations. Normally we would wait for a break below the previous session low for a short entry however in this morning’s Swing Trader’s Insight comments I suggested we look to short on a break below the 1000 level as it was likely support.
July soybeans did drop below 1000, making a low of 999-2 minutes after the 8:30 AM open. I don’t like to take trades right on the session open so I didn’t short it then. Instead I looked to sell when it broke the opening range low; this entry came around 10:30 AM. Soybeans sold off for the remainder of the session, closing near the low. I’ll be looking to potentially sell them again if they break below the May 17 low of 992-4.
The eMini S&P had a breakout setup as well, as Tuesday was an NR7 day. This is a reason I like breakout setups- after three consecutive higher closes it would be tempting to look for a selloff and a short sale. With breakout setups the best strategy is to let the market decide which way it wants to go and then go along for the ride.
The previous session high of 2752.50 would be the first long trade entry level. I was watching other markets (like the beans) so I didn’t take the initial entry at the previous day high. This entry turned out to be profitable after a choppy early morning and it ended up stalling out at the 2762.00 session high.
Breakout sessions tend to move in one direction over the course of the session so finding later entries in the direction of the breakout can be a good strategy. That’s what I did this afternoon; I bought when it rallied above the 2762.00 high, and it trended in our favor for the balance of the session.
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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