Friday, August 19, 2016

Day Trading E Mini S&P 500 Profitably using CUE Global

From the desk of Sagar Nandi and Superior Profit

Day Trading on E-Mini Future is possible almost 24 hours a day. Almost every day of the week.

CUE Global is a complete system that is used by investors and traders. From Long Term Investment to Swing Trade to Day Trade. All over the world.

Traders use CUE System to trade all sorts of instruments: Stock, ETF, Option, Future, Forex.

On 15th August 2016 I had posted a blog describing in detail one way I use CUE System for Forex Day Trading. You may read that Forex Day Trade blog here.

And just a few days before that; on 11th August 2016; I also posted a blog describing a real life Stock Day Trade using CUE Charts.  You may read that Stock Day Trade blog here.

Some readers requested me to post a blog on Day Trading E-Mini Future using CUE System. I am writing this blog to explain that.

CUE System techniques used to Day Trade Stock, Forex, Future, etc. are interchangeable. So all E-Mini Future Day Traders will gain valuable insight from the two blogs mentioned above. Just as Stock and Forex Day Traders will gain valuable insight from this post.

In the Stock and Forex examples, I looked at only the instrument that I was trading. I did not use correlated instruments. Instead, I looked at Longer Timeframe (Daily and; optionally; Weekly) to decide my Trade Direction and used Real Time CUE Chart to execute the Day Trade in that pre-planned direction.

That is not the only approach I use for Day Trading. Sometimes, I look at multiple correlated instruments; using same Real Time Intraday Timeframe, and then choose the one that is likely to give me the Highest Probability of Success or Best Reward Risk Ratio or both.

For E-Mini Day Trade, I often use this correlation approach. 

I will use two symbols. One is ES - E-Mini S&P 500 Future. And the other is NQ - E-Mini Nasdaq 100 Future. These two symbols are usually strongly correlated. Moving up and down together on an intraday time frame.  But not necessarily with the same force. Some days ES is stronger. And some other days NQ is more powerful. For Day Trading in the Long direction, we chose the stronger of the pair. And for Shorting, we use the weaker of the pair.

Now, what is meant by "strong" and "weak" here? Is it the different percentage moves that we see in Real Time data feed? Obviously, that is one estimate of strength. However, from a Superior Profit Day Trader's perspective, that is not the optimal way to measure force and use it in a trading decision. 

What works a lot better is to see the movement of the two symbols within a set of reference price levels or Pivots. The CUE Fine Tune Real Time template is ideal for that.

This CUE Fine Tune template is designed specifically for Day Trading. You can also use it for precision entry of Swing Trading.

Fine Tune template has automatically calculated dynamic pivot levels (horizontal dotted lines) as well as very smart auto-drawn-trendlines; Memory Lines as we call them. These provide the reference price levels to help us decide which symbol is stronger and which one is weaker.

CUE Fine Tune also has the very responsive (and thus; suitable for Day Trading) Stretch Release up/down arrow signal to decide quickly and unambiguously exactly when to enter a "reversal" trade; trade opposite to the immediately prevailing direction. 

Let us put all that together in a real life case. This Day Trade opportunity came during regular E-Mini trading hours on 15th August 2016. I will use the 10-minute chart here. However, traders can use 5 Minute or 1 Minute interval too if they choose to do that. Personally, for Day Trading E-Mini Futures, I find 5 or 10 Minute interval provides the balance between being on the trade early. So I can capture a significant chunk of the move. But not too soon that I get whipsawed often. 

Here are the charts of ES and NQ - side by side - using CUE Fine Tune template using 10 Minute interval. 
​The numbers below refers to the respective markings on the chart:

(1) I first assess which one of ES and NQ was stronger at Close on the day before. That is, at Close (4 PM EST) of the day on 14th Aug. ES had Closed somewhat below Day's High whereas NQ had Closed almost at Day's High. So, at Close, using the Day's High and Day's Close as reference levels, NQ was stronger on 14th Aug.

​(2) Next day, on 15th August, both ES and NQ opened with Gap Up.

(3) Both ES and NQ went above Early Range High and became Overbought at that level; as indicated by Stretch signal (cyan and green dots on top of the Candle).

(4) Neither instrument could continue the rally from the Overbought Stretch condition. Instead, both became weak as seen by Stretch Release signal (down arrow on top of the Candle). Both symbols displayed three Stretch Release indicator three times before they fell.

Both symbols looked similar at this point on the chart. However, there were signs that ES was weaker than NQ. For example, ES had a Candle Flow color turning Bearish magenta before NQ. Also, on the third Stretch Release Candle, ES crossed below Early Range High. However, NQ remained above Early Range High pivot level.

Using the above analysis, I concluded that ES was weaker than NQ. Both at 14th Aug Close and also after 15th Aug Open.

And therefore decided that for a Short trade, ES would be a preferred candidate.

I will now explain the Short trade execution using the ES chart below using 10 Minute Interval and CUE Fine Tune template.
​The numbers below refers to the respective markings on the chart:

(1) I took the Short trade on the third Stretch Release sign. ES crossed below Early Range High at the same time. And Candle Flow color turned Bearish magenta. These three signs together made the Short entry a High Probability Trade.

(2) I placed Stop Order immediately upon entering the trade at just above Day's High. This was a small risk amount relative to ES's usual daily move range. This Stop Level was never violated.

(3) After my entry, ES fell. And the trade Profit soon surpassed the Risk taken. I closed half position at this point.

(4) Immediately after booking partial profit, I moved Stop to Breakeven level. That is, to the Entry Price Level. Breakeven Stop was never hit.

(5)  At day's Close (4 PM EST), I closed the remaining position.

Following are the salient points of this disciplined and profitable Day Trade using E-Mini Future.

A) I selected ES over NQ for a Short trade by observing the symbols' move within CUE Fine Tune pivot levels.

B) I patiently waited for both NQ and ES to turn Bearish. And executed the trade without hesitation when multiple signals were aligned.

C) I placed the Stop Order immediately upon trade entry to manage risk.

D) I booked partial profit as soon as Risk amount was covered; making it a Risk-Free Trade from then onward.

E) I closed the entire trade at the end of the day. I had planned it as a Day Trade. And closed it as a Day Trade.

​This Day Trade was taken on E-Mini Future. However, the same technique of choosing one particular instrument from multiple correlated instruemnts for Day Trading by usign reference pivot levels of CUE Fine Tune template can be applied to other trading instruments like Stocks in similar industry, to Forex pairs etc.

For learning more detail of the pivot levels, Stretch Release, Candle Flow, etc. - which are part of CUE Global System, you may refer to the training material at Superior Profit Education Center.

And also feel free to register for our Live Class held on a regular basis. Where you will meet other traders from around the world discussing Market and potential trade set-ups.

Sagar
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