ES Update!

3-21-10

Hello Traders,
Looking at the ES daily chart we have broken out from the last high of 1148.00. From there we made the first push to 1165.50 and as i write this article (Sunday Night) the ES just came down and retested the 1148 breakout level.

Thursday the ES closed a Doji then friday we took that Doji out to the downside or "bear engulfed" the Doji from Thursday. This is a sign of weakness but since we are holding above the 1148 there is still strength in the market. This could change fast once the market opens tomorrow.

The bigger outlook level we have for this leg to complete is the 1228-1238 zone. Does that mean we are going to go up to that level in a straight line? No, but that is our upper target on this leg. Once we have our Daily and Weekly upper target we break it down day by day with the nightly emails to keep our members trading with the symetry of the markets.

Thusday night we had our target of 1152 for fridays predicted low. We did trade down through that a couple of points but then closed back above that level. On the shorter term outlook we are looking for 1174 to complete the smaller wave IF 1152 holds tomorrow.

The Key in trading the patterns is to have a multiple time frame outlook and for that we use a 60 min, 10 min and 3 min chart. The 3 minute is for our entries using the Kill Zone #2 indicator to confirm the pattenrs and to give us the entry and exits.

The reason we use a 60,10 and 3 is so you have a 3X6 view on the markets. When day trading we are making it harder than it is suppose to be meaning; if we were just swing trading it would be a heck of allot eaiser becasue all we would have to look at is the Weekly and Daily charts. When we break down a daily bar into intraday bars we are throwing confusion into the situation and there are so many intraday intervals we can use , which one is the right one? The answer is there is bigger waves and smaller waves within the bigger waves so knowing that we do not want to have too many time frames up to confuse us, especailly a 1 min chart. For this reason we like to keep our charts clean without allot of conflicitng indicators and keep the daily bar broken down into only 3 time frames or 3 different views on the market to keep us always trading the 3 and 10 min in the direction of the 60 min trend and pattern.

If you find yourself confused during the day slow the market down by using a bigger time frame and remeber the bigger time frame always prevails.

To learn more with how we appoach the markets simple email us at trade@eminischool.com and we can set up a time to talk and look at the charts together in real-time.

Have a great trading week!
www.eMiniSchool.com