Warrior Trading Blog

Monday Day-trading Scalps +$2,175 | Steve’s Futures Pulse 201


Hey, what’s up fellow trader? Trader Steve here. Happy Monday to you. Well, I’m all done trading for the day and ended up netting $2175 in my trading activities today. How’d we do it? Three separate markets. We had the crude oil, the Swiss and the copper. How did we fare? Well, we scratched in the Swiss. Nothing gained, nothing lost. It was time to cut bait because the market didn’t follow through. Capital preservation is the name of the game. Second, copper lost $1275 on a market that gave us a fake break, and it was time to preserve capital there as well. But the big story of the day, light sweet crude. We leveraged three separate short positions on three separate occasion for three wins to score $3450 again, putting us up $2175. I’m done for the day. We’re keeping it green and a good start to the week. Watch today’s Futures Pulse when I break down the markets so you can learn a little something in the meantime. I’ll look forward to meeting you back on the market soon until then, trade well.

All right. Let’s first start by taking a look at the Swiss, which ended up going on to be a break even or a scratch in the market. So the Swiss here was a trade that looked like it actually had some promise for the market to break outside of the congestion zone to the upside, and that’s what we’re looking at. We saw on both the 10 and the 30 minute time horizon, the market was going into that breakout mode of establishing itself above that supply area, on the 30 minute time horizon. That was $102.41. Over here, it was even a bit lower on the 10 minute time horizon at $102.28. Anyways, we end up initiating a long position on this one at $102.45, which is right in here and then it’s also just a smidge above that supply area.

We’re looking for this market to break through and fill through the volume gap up above, which it will do oftentimes in this chart pattern. That’s why we entered the long side of the trade, but it wasn’t meant to be. Market went laterally for an extended period of time, never did kind of get enough oomph to get through and break out of the congestion zone and navigate through that volume dip. So we end up closing out that one at the exact same price, just $102.45, the same price we entered. No harm, no foul other than of course, execution costs and exchange fees. Those are very low in futures, so it’s really incidental to the decision to scratch the trade.

Let’s move over now to the copper trade, because this is the one that did end up being a loser for us here today. Copper is an industrial metal that actually tends to have real nice intraday trends when it’s in a nice trending environment, and I thought we’re going to get it here today. The market was starting to break down below the demand zone that you see right here. Bottom of this demand zone comes in, say $254.25, and you start to see also a breakdown over here on the 30 again, still again watching side by side the 10 and the 30, looking for confluence in the trade. Saw this big gap in volume. Notice how there’s nothing in terms of volume down below if that market were to continue to navigate. So we pulled the trigger on the short side, initiating short position at $253.90, which I’m going to highlight for you so you can see, get a reference point right in here. And then on this side I’m going to show you, it’s right there.

And when the market did start to give a little bit of signs that it was going to make that break, $253.65 is as low as we got on that bar as well, as I’ll go back in time over here. It’s this bar right there, but that’s it. That’s as low as it got, so it wasn’t really enough to go into profit taking mode. And then you can see after that, the market just kind of grinded higher through what we call the value area. That’s between the green and the red line, which identifies the balance zone of the trade and it started migrating up. We ended up calling it quits on this trade, not liking what we saw at $254.75 rate here. Had six units, so gave $1275 to the market on that one.

All right, so let’s get to the good stuff. You guys want to know how we were able to navigate the crude oil, because that was our star of the show today. So crude oil, which I’m bringing up right now, October contract, we played the short side for a few reasons that I want to set the stage for, before I show you the three winning trades on three attempts that we did here in the crude. First is, same rules of engagement that the other ones that we end up scratching and losing a little bit on, were the technical reasons for this trade. Again, we saw the market establishing itself down below, below the demand area, which is the green line. You can visually see the market’s breaking free from all the congestion. Saw it on the 30 as well, but it’s worthy of note that in the future’s room we also brought up the 60, because I was looking for a little further affirmation from a longer term swing timeframe to make me feel good about the trade as well, and we got that.

Look over here. That comes in at $54.39 and that, so we basically are in a bear state of mind, anything down below that $54.39 in particular. So let’s back up here. Let’s go to the trades that we initiated here. The first chart entry on this trade this morning came in at $54.49, right just a smidge down below here and right on the break, just below the $54.49 level on the 30 minute chart, beautiful thing. Less than two minutes later we were able to get a dime move lower. So I covered 11 to 12 units for $1,100. Remember, each penny in crude oil’s worth 10 bucks. So I covered, took virtually all the risk off the trade very quickly and scored $1,100, then moved the stop to just $.04 from our entry point.

And we did get stopped out on that, so it gave back $40. Big deal. I’ll make that trade any day of the week. $1,100 and give the market back $40. So that’s how that trade ended up. So we’re up over $1,000 already on the first entry. Then we found a a nice little opportunity on the short side in crude oil, on this one down a little bit further. So we looked at a short position again because the market was reaffirming its intent to break lower, initiated another short position, this time $54.28, a little bit lower here as the market kind of earned our re-embrace. I’m going to highlight it so you can kind of see right about where that is. And then again, the market gave us that dime break lower. So we’re going after another dime, $100 a contract, scored 11 or 12 units again, another $1,100. 11 contracts times a hundred dollar value on that move, a dime, and this time we ended up having a giveback of $.09 on the remaining stop.

So the stop was $.09 above. That was at $37, and the market did pop up there and stop back. So again, $1100, give back another $90, we’ve made another thousand dollars plus on that trade. So, so far so good. I actually at that point I was of the mindset that that was probably going to be it for me today. Still a small green day, but the market pulled back up to another key level, and again this kind of popped up unexpectedly, but I did find a nice little opportunity to reinitiate on the short side again, $54.39. So kind of splitting the difference from our $49 entry, our $28 short side entry. We kind of came into that middle tier at $39, which I’ll highlight right here. There’s your $54.39, and on this chart over here, right up in here, bingo.

And this one, the market broke again for us. And this one, we have three different scale outs on this one. We got again, another dime lower. We grabbed 6 to 12 units at $54.29, so we added $600 to the crude oil and then the market came down and it kind of toyed with making a break, but it didn’t make it, started coming back up. I wanted to mitigate risk, didn’t want to make a good green day in crude turn into a giveback day. So we covered five of the remaining six units at $28, and then we’re down to our single unit and that thing broke a bit lower. We ended up covering that a bit lower at $54.16. So it looked like this: $54.39, and then I’m going to write 12 right there. So it’s 12 there. And then as we broke lower, we covered six at $29, which is right there.

So I’ll write six on the cover and then a bit lower again. The market went down again, came back up, we covered five more, I’m gonna write five, part of my chicken scratches, and then the market broke a little bit lower down to 16, and we got that last one. So 12 and then cover six, five, one, but that was great because we that added to the crude oil success and it ended up basically what made today a nice winning day. You can see it right here. So this is how it shook out.

Scratch on the Swiss. You could see six by six and zero on the P&L, crude oil, $34.50, 36 by 36. Again, three separate 12 lot entries that we’ve managed in the ways that I highlighted here today. And then in copper we did lose $1275 on that, but feel good about where we cut bait on that trades to ultimately have a $2175 day to start the week. So that’s all she wrote. Look forward to meeting you back at the markets again soon. Until then, trade well and be well. So long everybody. Bye bye.

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