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Market Commentary November 2, 2009
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Our first trade of the morning came on the Crude Oil market, (Symbol CL). Today, the Crude oil market produced a rather large channel throughout the day, oscillating from roughly 78.60 to 77.00. Early price action was slow to start, most likely to the FOMC decision about to take place later this week, but the opening of the pits trading at 9:00am EST as well as the U.S Equities market at 9:30am EST brought the market lower with added volume. It once again tested the highs of the day shortly after that, but when watching the tape at the highs, it was clear that the market participants looked to keep the range they had set early on in the morning (Identify Market Sentiment For Day Trading Futures). As the market was selling off earlier in the morning after the open outcry pits began to trade, we looked to take advantage of the short side pressure and join the sellers. At 9:16am EST we entered the crude oil market based off a Breaker short patter at 77.15. Once our order had been executed, we didn’t have to wait long before our first price target had been reached, allowing us to take profits at +4 ticks (2 contracts) before closing our trade with a total of +8 ticks ($80).+1029am.JPG)
The second trade of the morning came about an hour later, due to the release of news in the U.S, and we were able to identify a great set-up on the Mini-Russell (Symbol TF). The Mini-Russell consolidated amid the early hours of electronic trading, but once the U.S equities market opened up at 9:30am EST, the sellers jumped on the opportunity with significant volume, pushing the market even further south (E-MINI Futures Day Trading Video). The sellers finally found a bottom around 10:00am EST, at which time the buyers began to rally once again towards the highs of the day. Once this happened, we knew it was time to enter the market, with volume seeming to be on our side, we entered the market at 10:19am EST off a Breaker long pattern. Once our order had been executed though at 566.8, it seemed that the buyers no longer wanted anything to do with the market, and price action began to slow down considerably. Upon seeing this, we decided it was best for our trading account to exit the trade at our entry price, +/- 0 ticks.Not long after our scratch trade on the Mini-Russell occurred, we decided to scan the markets for another set-up, this time taking refuge in the Crude Oil market once again. The Crude Oil had continued to oscillate, finding a top around the mid-$78 price level. It wasn’t long before the sellers took over control of the market, allowing us to look for a possible entry to the short side ( Crude Oil Futures Day Trading Video). At 10:29am EST we found just that; with a Breaker to the short side. We placed out stop limit order at 78.17 and were executed shortly, once in the market, volume kicked in with more sellers coming across the ticker tape, allowing us to get +4 ticks (2 contracts) before closing our trade with a profit of +8 ticks ($80).
The fifth trade of the morning came only minutes after we had closed our trade on the Mini-Russell, but this time it was on the British Pound futures (Symbol 6B). The British pound futures also kept a rather tight price range today, hardly exceeding 1.6430 – 1.6330 (Sideways Market Day Trading Futures). The market oscillated multiple times today inside this range, and we waited patiently for a trading opportunity. At 11:02am EST opportunity finally knocked and we were there to take advantage of it. With the market coming off its recently made lows, it began to pull back to the long side, which is when we took our trend reversal trade, the 2-Step, long at 1.6382. As soon as our order had been executed, larger buyers came across the ticker tape, obviously wanting to push this market higher, which indeed it is, allowing us to take profits at +4 ticks (4 contracts) and again at +3 ticks (4 contracts) for a total of +28 ticks; we trade double the contract size on the British pound because of tick value ($175).
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