An emini scalp-trade example using a strategy outlined in part II of my emini scalping series

Today provided a great example of  an emini trading strategy that I outlined in part two of my emini scalp-trading article (see here).

While this played out I was unfortunately leaning over a toilet suffering the effects of food poisoning.  But regardless,

Check out the following chart:

I have marked white horizontal lines on the chart that show the overnight session low, as well as the low from the afternoon session of regular hours trading.  These are levels I can anticipate trading at during the morning session.

As you can see, this morning price kissed just below the overnight session low (which I suggested in my article is a good strategic buy point given the setup) and then had a powerful rally.  This is a textbook example of  a slam dunk trade setup.  Just a 20 minute hold would have yielded around 10 points.  3+ points in under 10 minutes.

Note that I am using a 30 minute chart, not a 1 minute or a 5 minute.  Do not be fooled into focusing on the forest rather than the trees.  Just about every day trading setup worth trading can be identified on a 30 minute (or even longer term) chart.

When do you enter your orders?  My preference is to go into the day knowing the game plan, and to simply set resting orders at the levels I want to trade.  If they trigger then I am in at a point where I think I have an edge.

And if they do not execute?  Then I do not want to feed quarters into the market with random trades.   In trading, activity does not equal accomplishment.  Repeat that over and over.

Now, it does not always play out so perfectly.   A trader might ask, “what if price kept crashing down?   Well, What if?   Dealing with “situations” is just part of trading.  If a trader can’t accept that, then quite frankly it will be impossible for them to trade profitably.

The answer is that as the situation unfolds the trader uses the other parts of his trading plan and risk management method.  Simple as it is!    It is the exact same as with automated trading:  The system must have logic to deal with different contingencies.

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