Warrior Trading Blog

Emini SP Morning Comeback +$4,700 | Steve’s Futures Pulse 141


Hey, what’s up, fellow traders? It’s Trader Steve, Futures lawyer, here, and boy oh boy, do I have a treat for you.

So today was an exciting session, albeit volatile in the index futures. To kick off our chatroom session, we took a long position in the E-Mini NASDAQ, and guess what happened? Volatility got the best of us. So we took a small loser. But we stuck to our strategy, trusted our plan, and we got long in the E-Mini S&P and capitalized on what ended up being a $4700.00 play to the upside.

Now, here’s the special treat part. I was recording it all live in the chatroom, so when you watch the video, it’s going to be a little longer than normal. But if you watch, you’re going to learn about the why behind the trade, where I took profits, how I trailed the stop along the way and you’ll start to wrap your head around market profile the way I deploy in the Futures Trading chatroom. I hope you enjoy it, and I hope you keep staying tuned. Come on, let’s take a look.


All right, guys. Remember, we’re long here, we’re long here, 28.84-1/2. Okay, I’m going to draw the line where we are, right here. That’s where we’re long, where I drew that line. If I draw it on the 10-minute chart over here, it’s right about there. We’ve got our stop down 75 and a half, risking nine points to volatile trades, that’s why but here goes the pop we’re looking for right now. I’m up $4300.00. Just like that. Let’s go, gonna see that market move above that congestion zone. Here it is, right here on the 30. And we’re in business. Market’s at 91 and a half, we’re making a comeback. We just turned up on the day that’s huge, we’re off to the races here.

Who’s on a long style on E-Mini S&P with me? All right. Remember we talked about that 92 zone? There’s your first to your profit right now. I’m taking out three units. Three units right here ’cause it’s a risk reduction move for me right now. It’s just sold three of my 12 moments ago, we just booked, beautiful thing. 13.50 I’ve just took off the play. I got $3800.00 in running on my remaining nine. Here we go, we’re at key spot on this chart here. I gotta focus guys, I can’t type, okay? Just watch what’s going on, we’re right here at this key area. It was 28.95 area as we get ready to break above it, watch over here on the left of my chart, this is Taz price compressor levels. If we break above that, watch we’re gonna get that nice little surge.

We’re gonna make a run to that 2900 if we breech it, look out we’re gonna have one heck of a day today, okay? We’re up over $5500.00 on my remaining nine units. I closed up 13.50 already. Okay we’re right at this key area, about ready to make the break. Watch it, watch it. Gonna have a fun little trade recap for ya in just a little bit. 28.96 we’re having a tough time breaking below that. Just sold out three more units a moment ago. That’s a beautiful thing. Okay don’t forget to reduce your lot sizing. Reduce your lot sizing if you’re making that same move as well, okay. JEN took out five beautiful thing, you’re happy. Who else is on the long side? Who just took some out? Zen? Beautiful thing, you took out three units, beautiful thing.

Okay we’ve got that long range bar, we wanna manage risk on a long rage bar here. Okay we’re at 92 right here. Market has potential to come back down through this long range bar and here it goes, it’s getting ready to do it. We’re gonna take three more profits. Bingo, okay I’m out of nine out of my 12 here. We’re looking good. We’re taking profits out of the market, not being greedy I’m up 35.62 on my closed out profits on the trade. Still got 7.50 in running on the remaining three units. And moments ago I just moved my stop up 81 and three quarters is where my stop is right now. 81 and three quarters should we start to break back down and below that level, okay. 81 and three quarters. It’s this level right here I’m watching. I still wanna give this market a chance to give us that runner. That big break out and run towards 2900. But again, we’re not gonna complain here being long from 84 and a half. That’s a beautiful thing.

JEN up over $15000.00, you’re out trading the coach. Good for you. Don’t forget during these times here, when you’re just sitting watching and waiting, don’t forget to make your adjustments to your lot size. You gotta tend to risk during these time, okay? There’s nothing for you to do every single time, and you’re gonna manage risk. You gotta make sure you stop locks matches your remaining lot size. So when we take profits, we’ve taken profits three times here. Every time we do that, we need to be changing our lot size on our remaining protective stop okay? What I’ll do often times here now as well, I’m gonna take my 10 minute chart now watch here, I’m drilling down to a three here. Just moments ago and here we go, we’re gonna get another surge higher. Watch this over here, watch my cursor right here. Follow the yellow arrow, follow the yellow arrow.

This is the move we’re looking for, I wanna make a run to 2900, if we get close to 2900 that’d be a beautiful thing. We don’t wanna be too greedy in the process. I’m in the three minute chart ’cause I’m looking for another level that we can manage our risk to. So I’m looking to move amongst my taz boxes levels, I’m down below the demand area, below the POC. And if I come up here, we’re gonna be able to put our runner, our remaining units here in better in break even. I’m moving it up to 85 and a half. 85 and a half which locks in a full point $50.00 a contract. My worst case on this last part of the trade’s gonna be $150.00 but we’ll give it a chance to make a run for us here right now. So we’ve effectively totally taken the risk out of this trade entirely. And now this is the fun part, right? We get to sit back and see if this is gonna make another surge higher. It’s exactly what we wanna do as traders, okay?

We take the risk, accept the risk, we took a little bit of heat early on in the trade, not too bad but I pulled back into the value area. Post entry. Then we start getting a break, the market moves fast, now we’re taking risk off by taking profits, putting it into our pocket. And then we now have this in a position here now where our worst case stop here now on the remaining for me, three units. Is at 85 and a half, again we’re long at 84 and a half. So we’re still gonna make money even on that last part of the trade right here right now. I’ve closed out 35.62 and we’ve still got 12.30, 10230 running on this last three units right now. Okay?

It would not be possible now remember if you didn’t have the disciple, patience and confidence in the strategy that we put together, that’s the key to be able to come back, get back in the betters box. Even if you get bounced out of a market earlier, have the confidence to come back and make the trade. All right, we’re making a retest, focus your attention right here okay? We’re making a retest of this supply area, that’s that red line right here from your test boxes indicator here. We’re making a run right towards it, that top of the box comes in, I’m gonna tell you at 28.96 even, we’re almost there. We’re at 94 and three quarters. This is not a bad place, I’m gonna actually look to reduce my risk even a bit further. We’re gonna sell out two of my remaining three, so then I get to have just one remaining runner left in play.

So I’ve now closed out 11 of the 12 units. I’m down to one unit, and this one’s got 5.50 in running. And basically this is the one we just let run. We’re gonna let this thing run, run, run. And the only way we’re gonna get out of this last one is if we get stopped out as we continue to trail the stop but behind the trades. Does that make sense? And it was all because survivor eye of the tiger came on. Eye of the tiger… here we go, 28.96 we’re making a run towards that 2900. Oops, here we go. Here we go, that’s the 2900 mark. Go, go, go. That’s the power market profile right there for you. Thank you taz market profile. Thank you market profile. Thank you [inaudible 00:08:09] for your great work. Going back to the 1980’s.

You would not see that break out. You would not see that trade if you were just sitting down here looking at volume down by itself. See down here? That’s just volume down there. Was there anything down there that gave you an inclination to be getting long? Absolutely not, not one thing. There was not one thing… look at this. Let me make it nice and big. Maybe that’ll help you, hold on. Here you go. Watch this. Let me make it nice and big. Not that, that’s taz ratio as well which gave us a nice turning point on the break there too. Okay let’s focus our attention down here. Here’s volume, see that I got it circled right there. Here. Here’s me drawing a line, follow the arrow. That’s what volume looks like during this trade. If you could tell me what in looking staring at that, gives you any inclination that that market was gonna turn around and bounce higher, I’m all ears. But I don’t see it. There’s nothing in that that’d help me put together a trade.

However, with taz, with market profile, I saw the break. We started to see the breech above 28.82 on the 30 minute. We saw that we had the master point of control down below. And we had a nice little place we could choose a sensible risk, giving the volatility. Bright green colored bars as taz telling you to be bullish, bullish, bullish. That’s the power right there. You got to see it live. This is three minute chart we got on the left. 30 over here on the right. Zen’s taking more profits at 28.98 just ahead of that 2900, I like that exit point. I might make another run towards this 2900 here. So as we expect here, as you’re watching this right now, we’re not surprised to see that the market is getting comfortable, settling back down south of that 2900. Yes, we want the market to break above 2900 right? Because well we got selfish motives, we wanna make more money right? But the reality is that right here… remember in market profile, that red color zone in your taz market map indicator identifies about 70% of the volume that’s occurring in the market.

And when the market’s in there, it’s comfortable. It’s the most popular part of the playground right? It’s where all the cool kids hang out. We pulled 45.87 out of this E-Mini S&P in about the last 10 minutes. We got 500 in running here on the last one. We’ve got a new level here that we can trail our stop up just a bit. See 28.87, this is a three minute chart. So you see as we get these new levels that shift, the red blue and green line shift higher, that gives us the blueprint to trail our risk behind the trade. We’re gonna do just that, okay? So follow me here in the room, those of you that are in here. Some of you still got a runner left with me, all right. Raise your hand if you do. Why are you guys raising your hand? You guys don’t got webcams on. You know some of you rose your hand, you know who you are.

Matthew just grabbed some profit on crude, nice, good job. Stop’s gonna be at 86 and three quarters now, so we’re moving it up from 85 and a half, too 86 and three quarters. We’re just trailing it up a little bit, we’re putting a squeeze on the risk side of the equation. But still leaving an open ended profit objective. This is how you ca expectantly grab yourself a little windfall out of the market. Even when you’re not expecting it. This is one of the big mistakes I think retail traders make. They don’t give themselves a chance to turn a single or a double into a triple, and better yet a home run ’cause they’re just so thrilled to take a little profit and put one in the W column. That in a trade like this, yeah look I still got $400.00 that I could… right now if I just exited the trade, be along from my last unit from 84 and a half. I could get out and I could add another $400.00 on top of 4500 on this trade. And as tempting as that is, remember I think the opportunity cost of jumping out.

And not giving it a chance to give me another surge higher… who knows, maybe the market surge is expectantly another 20 points higher. That’s $1000.00. So there’s an opportunity cost when you make the decision to get out of your last unit and futures. I have always been a first focus on risk. And it’s probably not very popular in the retail world. That people always wanna talk about all the money they’re gonna make. I wanna talk about the risk. Am I okay with the risk. Where’s my next risk move. And what excites me the most as this trade evolved, and we took profits out of the equation was actually it reduced my risk. I know it’s twisted I suppose but, the reality is that’s the way my brain works. And if you get your brain to start thinking a little bit more like that, or at least in that direction, I think you’ll be more mentally prepared to take loses in stride. And it will happen.

And its gonna help you keep an even keel temper to manage trades, where you have open ended reward factors on your final unit. And that’s what’s fun about trading. Right now this is fun, this is fun to have this E-Mini S&P trade that we’ve pulled some thousands of dollars out of. And it’s still running, it still could get better. I talked yesterday about the difference between gambling and trading. There’s no table game in Las Vegas that let’s you keep the hand that just made you a bunch of money. You don’t get to keep your hand. They shuffle the deck and you get dealt new cards in Las Vegas. In trading you can keep the same cards, that’s what we’re doing. We’re keeping the same cards, the same hand even though we took profits and chips off the table. In gambling the one time of that happens, the roulette will stop you either win, loose, you get your money, you gotta do it all over again. The odds get reset.

As a trader, we get to sit there and get to keep hold on our hand that we like. You see how there’s a distinct difference? Nice job Adam. Adam did some paper trading it looks like on the Micro ES. It’s good, it’s reputation. I wanna tell you when it comes to sim trading, those of you that are still practice trading and preparing for live trading. It’s like any skill when you learn to play baseball in the bating cage, it’s not a real game right? You’re hitting into a net. But you’re creating your trader muscle memory, and that’s really what’s important. Because then when you Segway a live, for those of you that are still in the stimulation environment, when you Segway to live the brain has been trained to do the same exact thing. There’s no different. There’s no difference. Except one thing, it’s real money okay?

Now if you can get over the emotional attachment from sim to live, and there is a psychological element to that, I’m not gonna tell you there’s not. You’ll be just fine. So here we are, 24.95 and again we’re sitting right on this launch pad right here. These are called price compression levels those of you who are sitting in for the first time perhaps. These set the middle grounder, called the mutual area. The area between the battle between the bulls and the bears. So when we move above that top aqua line, we have moved into the bull camp. And then these become our resistance levels. So this is called R1 pardon my chicken scratches, R2 and R3. And these are intact the entire day. It’s called static test, static price compression levels. It’s one of seven of the indicators.

Down below these are called our support levels. S1, S2, S3 and they just sit here all day. Most of the levels you don’t need most of the day. But for instance on a trade like this, that’s why I was talking about this 28.95 area being a big deal because it’s possible if we break that 2900 area, we could see this market make a run towards believe it or not, I know this is optimistic thinking, 29.28. And I’d love to see that happen rest assured. Now this is the part of the trade I’ll tell you where it’s easy to get out of the trade, just to get out of the trade. Because again we see the surge, the market is retreating off that 2900 key level and so forth.

But I urge you to fight the temptation to do that. This trade if I get stopped out, I’m still gonna add over $100.00 little cherry on top of the sundae if you will. So you gotta be okay with that. Again what I’m helping you do is to frame your brain around the fact that there’s an opportunity cost of getting out prematurely. And I want you to be mindful of that. Especially if you’ve already booked some gains on a trade like this. Give yourself a chance to hit a home run. One of my favorite sayings amongst many favorite sayings… but one of my favorite ones when teaching traders about this concept of opportunity cost is, you can never hit a home run in baseball if you stop at first base. Which is true by the way. Even if you hit it over the fence, if you don’t round the bases and touch every base including home. You don’t get the run. There’s a little fast fact for ya. All you baseball lovers.

Hold that stop, hold that stop. Let the market do something special for you. This is the type of market, this is the type of trade that gives you that opportunity. If you let it. Hey I see you there. Have you enjoyed that video? Give me a thumbs up and leave a comment down below. And be sure to subscribe for more great videos just like this. From all your trading.