Plan 4-26-24: Plan 4-26-24: Reclaim or No?
What this letter is: A Daily visual plan that I use to trade /ES futures
What this letter isn’t: An alert service.
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No writing here is influenced by market fundamentals.
The focus of this stack will always be efficient trading. A simple daily letter outlining short term bull and bear scenarios coupled with a bias displayed visually on easy to read charts. Price action examples are explained and annotated when they’re relevant to the current day.
Levels given take into account channels, volume profile points of control, key zones acting as either magnets or potential squeeze targets.
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Notes on Trades:
IMPORTANT - Execution is as important if not more so than levels. Please read my pinned guides to understand the concepts of reclaims, back tests, entries, exits and stop losses for help with execution.
There is no perfect play, only optimization of risk to reward using probabilities, market mechanics and strict rules established through back testing.
Targets don’t predict pullbacks nor do supports predict bounces. They’re simply points of interest to pay closer attention to price action. If a target is hit it doesn’t mean price will instantly pull back, it just means the probability becomes higher.
When bullish on /ES all supports are stronger in liquid individual tickers and dips are buyable. In contrast when bearish on ES resistances are stronger and pops are shortable. Having an accurate bias is everything as playing individual tickers is often just a proxy for playing the index itself.
How to Follow a Plan:
Every day an overall roadmap and a bear/bull scenario are given. The bear/bull scenario are the highest probability setups I see at the time of writing - not a prophecy as to whether they will occur.
These plans are based on recognizing similar scenarios/setups over my past experiences trading. To execute a plan it’s a traders job to identify which scenario is likely playing out based on how price is interacting with the levels outlined in the plan. After that trade management sees profit taking at resistance and trailing a stop loss for runners.
Trade plans aren’t set in stone. They need to be confirmed in real time by the various mechanisms to move price ie failed breakdowns, breakouts, back tests, support/resist flips, sweeps etc. All of these concepts are outlined with examples in the articles pinned to the top of the Substack.
Lastly there is a certain cadence to a trading day. The key times to trade are 2:00 AM, 7:30-10:30 AM and from 3:30 to close (market time). These represent the London session open, the cross over between New York open and London close and the MOC at end of market session. These all provide “volatility windows” for price to make a move. Typically price follows a setup during one of these windows which we intend to capture. Then price spends the next few hours (or days) chopping the various levels to confirm the move that has just been made. This letter does not focus on the scalping strategies necessary to trade intraday chop but this is a common time when traders end up giving profits back from the clean move already captured.
Daily Recap:
Today started out poorly - I took a 4 point loss on a full position size which was covered in chat. Rather than try to hide it I think its better to address the fact everyone takes losses and has difficulty.
I was convinced /ES would pop before a potential drop and the news candle sold off directly. After the initial loss I was able to take a few trades for a net green day of ~22 points.
The main trade idea at open was positioning the false breakdown of the 50 SMA which I traded into and out of.
The above trade was exited for a few points and I re-entered again later after stepping away mid day.
I was happy to see others do so well today even though it was a rough start:
A bit of additional context. All the above winners won on their own not due to callouts - It’s just awesome to see people turn corners and do well.
The morning sell also leaves price in an interesting place for the near future so we can update higher time frame bias with a bit more information than we had started with yesterday.
Full Recap:
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