The emini S&P had a big down day yesterday which moved through two recent small buying gaps and tested into a third very large buying gap. There was a slightly lower open for the regular trading hours today. The market then dipped a few ticks below the large buying gap low before bouncing to yesterday’s late intraday swing high. That swing high was a known resistance area that was our short trade entry preference.
The entry was made after the market probed above that resistance and then tested that high. That bounce allowed us to get short in the 2366 area. The trade moved quickly in our direction for a maximum move of 9 points. The 4 contract trade was exited at plus 3 points for 2 contracts and plus 6 points for 1 contract. Both were on limit orders. The final contract was exited with a stop order for a 5.25 point profit.
Noteworthy points on this trade were the entry after the failed test of the high of the day and the several stop adjustments that were made. The “day trade the markets” software was used for trade entry location and for the trade management utilizing an auction-based market logic and the recurring box formation.
Net result on the trade was a 17.25 point profit for the 4 contracts. http://daytradethemarkets.com