ESU13 EMINI S&P SEPTEMBER FUTURES CONTRACT

The ES decreased in price on Tuesday and was able to close the gap that was created by the overnight market on Sunday and then some.  The selling pressure was news driven and due to McCain speaking about Syria and possible invasion.

The ZoneTrader Weekly Profile captured the underlying psychology once again and told us traders that this selling would not sustain itself, the Bulls were in fact in control of the market on the week and the movement was an overreaction to the news.

 The time filter held above the top of the Persistence Zone denoted by the 2 orange lines, which again represents where the fight was the greatest the prior week since we are discussing the weekly profile.

This gives us our control bias and tells who is in control of the market on any of the 5 profiles that we apply it to.  With the time filter holding above the top that told us that the bulls had taken control of the market on the week and to look to buy the first retrace, utilizing the Daily Profile to trigger the buy entry.

 During the sell off on Tuesday the ES came within ticks from touching the bottom of the PZ and then we began to see buying pressure enter the market once again and denoted the fact that the bulls were attempting to maintain control of the market on the week and keep the ES above the bottom of the PZ at 1630.25.

 The following candle closed higher then the prior and above the midpoint of the PZ or in the bullish half of the zone.  This generated the buy signals and told us the bulls had maintained control of the market on the week and to look for a move to the 1651 to 1653 area, which the midpoint between MR1 and MR2 on the weekly fell.

The midpoint is used to determine if the market is making a bullish breakout or not, by analyzing the close of the candle.  If the candle closes above the midpoint then the market is making the bullish breakout and we can buy the first retrace.  This is the current case since today we got that close.

Look to buy retrace movement tomorrow, utilize the Daily Profile and look for a failure to the downside which will generate a buy signal and will be derived from either Rule 8, 10, or 12.  There is key resistance at 1653 to 1656 area but if the ES can break through it prices will then test the 1665.00 area before receiving more key resistance.

Good Luck tomorrow the chart or screenshot of the Zone-Trader Weekly Profile is below.  Once again the Zone-Trader Philosophy kept us traders on the right side of the market and kept us from being caught up by the news driven movement, with the models ability to interpret the underlying psychology of the market in real time on multiple time frames.  Zone-Trader Philosophy the best Intuitive based trading methodology in the world.

ESU13 ZONE-TRADER PHILOSOPHY

The Zone-Trader Quarterly Profile suggested a failed bullish breakout on the Quarter and to expect a reversal or reversion of prices back to the Zone-Trader Pivot also called the point of control on 8/6/13.  At that point we began to hunt for sell signals being triggered on the Monthly and Weekly Profiles, expecting prices to revert to at least 1641.25 the pivot on the Quarterly and possibly lower.  

The blog i sent out a few days back discussed the developing bull trap and the Zone-Trader's ability to identify it prior to occurrence and thus take advantage of the sell off that would derive from tripping the sell stops of the traders that got long.  

In that blog I mentioned our expectation of a decrease in prices to the 1641.25 price level.  The ES came close today and most likely will hit it Sunday night or Monday morning.  Another pinpoint prediction by Zone-Trader Philosophy, keeping us once again on the right side of the market and in a position to take advantage of  the change in the condition.  

Here is a screenshot of the Quarterly Profile below, you can see the Zone-Trader Pivot identified by the white horizontal line at 1641.25.  Once the ESU13 hits this price level the market will become balanced on the Quarter and then will begin to oscillate around the Zone-Trader Pivot in attempt to breakout of the balanced oscillation area in either the bullish or bearish direction and create the ability to then attempt to make a bullish or bearish breakout on the Quarter.  

Keep in mind that as price approaches the Zone-Trader Pivot on the Quarterly Profile and MR2 on the Yearly Profile, which is at 1634.75 (screenshot below) bulls will begin re-entering the market since they are in control of it on the Quarter and they are currently attempting to confirm an uptrend on the Year.  

The bulls will need to keep prices above MR2 on the Yearly Profile for 2 more weeks in order to establish an uptrend on the year.  So expect a major battle to develop near that price level, which again is 1634.75.  Bears have entered heavily prior to and after setting the bull trap and they are currently in control of the market on the week and were also in control on the day, which suggest they are attempting to block the bulls from establishing or confirming the uptrend on the year.  

Expect spike in volatility next week and most likely sideways whipsaw price action.  The impulse wave of the market will decrease and v-patterns will develop with plenty of crazy ivans occurring as well.  Look for alignment on the Daily and Weekly Profiles prior to entry, utilize market orders for entry and set targets instead of trailing stops.  This will help maximize gains since we don't expect major trend moves to occur.  

Use the information being derived by the Zone-Trader Philosophy to adjust your style of trade in order to maintain alignment with the current condition of the market.

If the bulls fail to confirm an uptrend on the year and the bears are able to push prices below MR2.  Then we would expect a continuation in decreasing prices as the ESU13 would then begin reverting back to the Zone-Trader Pivot on the Year at 1497.00. a move of 154 points lower.  

ZONE-TRADER PHILOSOPHY 

             The Most Advanced Intuitive Based Trading Methodology In The World!!!!

Beautiful pictures were painted last night and throughout today's trading day by the Zone-Trader model on both the Weekly and Monthly Profiles, alerting traders and allowing them to identify a bull trap that was set by the price action and the close of Tuesday's trading session on a daily chart.

Zone-Trader Philosophy identified a failed bullish breakout on the Quarterly Profile 6 trading days ago, suggesting a retrace or reversal of the current uptrend was developing and to expect lower prices as the ESU13 was beginning to revert back to the point of control or the Zone-Trader Pivot at 1641.25.

We then begin looking for sell signals to generate on the Monthly and Weekly Profiles, utilizing the lower time frame in attempt to pinpoint our entries on the short side, and to identify profit taking price areas, as well as to identify or acknowledge manipulation based price action in the bullish direction that derive from large speculator volume in order for them to create a better entry for themselves to go short.

The ability to identify this manipulation that the Zone-Trader provides clearly displays and alerts traders to any and all bull or bear traps that are currently developing, depending on the direction of the current trend.  In this case with the ESU13 currently in a strong uptrend and a retrace or reversal of that trend underway, traders acknowledge this manipulation as a bull trap, and easily side step or spring it, which allows them to take advantage of trapped long positions and the decrease in prices that will occur do to their sell stops being triggered and converted to market orders; ultimately pushing prices lower and increasing the velocity of the bearish movement.

The Weekly Profile has told us that the bears are in control of the market on the week, and they will attempt to maintain control, while simultaneously trying to create a bearish breakout and possibly establish a downtrend on the week.  The Zone-Trader Philosophy told us this due to the Persistence Zone which gives us traders our control bias falling above where the market opened on the week.  If the market opens below the Persistence Zone then the bears are in control, because the Persistence Zone is a zone from the profile's that is being analyzed prior plot where the market spent the longest period time.  Wherever the market trades for the longest period of time tells us that there is an even number of buyers and sellers and that this area is where the fight is the greatest between the bulls and the bears.

Today the ESU13 failed to confirm an uptrend generating a sell signal, while simultaneously the bears maintained control of the market as they began selling when prices entered inside the PZ and provided the needed volume to block the bulls from taking control as well as from establishing an uptrend.  The combination of both of these auction market theories occurring simultaneously creates the ability for the market to jump start and sustain bearish price movement.  The PZ is identified by the two orange horizontal price lines.

This picture being painted by the Zone-Trader Philosophy on the Weekly Profile also confirmed that our current assessment on the Quarterly was correct and that we were right to assume that the price action and closing price from Tuesday's session was indeed a bull trap and allowed us to avoid getting caught in this trap and to take advantage traders that did, by pushing prices lower and taking out these trapped traders stops, again creating that domino effect and decreasing prices further.

EMINI S&P 8/9/13

The New Monthly Profile for the month of August on the ESU13 is suggesting for traders to expect a spike in volatility this month.  This is depicted through Zone-Trader Philosophies combinations between the Neutral Zone and the Persistence Zone.

Neutral Zone is MR1 to MS1 and royal blue with the Point of Control or also known as the Zone-Trader Pivot falling in the dead center of the zone and is white in color.

 Persistence Zone is created by 2 orange lines and is a zone from the prior profile, where the market traded for the longest period of time and represents where the fight was the greatest between the bulls and the bears.

Wherever the market trades for the longest period of time or what price area this occurs in, tells us traders that there was an even number of buyers and sellers for the majority of time within this depicted price area.

When combining the 2 zones to create the PZ/NZ combinations there are four possible variables, in this case the monthly profile currently is displaying variable 3, the PZ is engulfing the NZ.

Meaning the top of the PZ orange line at 1712.75 is higher then the top of the Neutral Zone or MR1 at the price of 1705, and the bottom of the PZ orange line at the price of 1667.50 is lower than the bottom of the NZ or MS1 at the price of 1690.50.

Hence the term engulfing the Neutral Zone is completely inside the Persistence Zone.  This PZ/NZ combo again tells us to expect a spike in volatility any time we see it occur on any of the five profiles.

The reason for this is because the Balanced Oscillation Area which is price area from the midpoint between the Zone-Trader Pivot and MR1 down to the midpoint between the the Zone-Trader Pivot and MS1 is residing inside where the fight was the greatest the prior month.

The Balanced Oscillation Area is where the market fluctuates while in a balanced state as it hovers around and or back and forth across the Zone-Trader Pivot or Point of Control, prior to attempting to make a Bullish or Bearish Breakout.

When prices re-enter the or are currently inside the Persistence Zone the fight that took place during the prior profile period resumes, and volatility increases as the Bulls and the Bears begin to battle for control of the market on that specific profile or time frame, in this case the Monthly.

Combining the two, once more tells us traders that whenever the market is in a balanced state on the month it will begin a major battle between the bulls and the bears for control of the future direction of the market.  So the impulse wave of the market decreases, while simultaneously the variance increases.

No statistical indicator is gonna provide traders with this specific information ever, especially the actual prices that the volatility spike will peak at.  Basically providing traders with the specifics of the current market condition on the month in this case and what types of trades work best in this environment, prior to occurrence.

Now us traders can adapt very quickly to changes in the condition of the market cause the current change is identified and explained by the Zone-Trader Philosophy.   Reversion trades tend to work best in this type of environment.  That does not mean the market cannot breakout and establish a trend, but the probabilities of this occurring are low in comparison to the market attempting to breakout or attempting to establish a trend and failing, and ultimately reverting back to the Point of Control or Zone-Trader Pivot.

This specific PZ/NZ combination occurring also tells us that most likely on the Quarterly Profile we may be starting to see the beginning of a reversal in the current trend, or a major retrace in prices.  In this case again this is assessed on the Quarterly Profile because Zone-Trader Philosophy tells us we must look one sequential time frame higher within the profiles.  So combo is occurring on the Monthly Profile, hence the Quarterly is the next time frame higher.

We now know the underlying psychology of the market within 2 specific profiles, and what trading condition to expect and which types of our rules to use that work best, a complete road map to tread the murky waters of the Derivatives or Futures markets.

No statistical based indicators are going to provide the trader with this specific information and or the change that is occurring in the current condition of the market.

Zone-Trader Philosophy the Best Intuitive Based Trading Methodology In The World.  Keep an eye out for our new trading course soon to be released and it will be packaged with the Zone-Trader Indicators for all five profiles.  The crystal ball of technical analysis.

Here is pic of the Monthly Profile!!!!

(08:17) Matt Reynolds:FIRST
(08:17) Matt Reynolds:THEN TOP OF PZ ON QUARTERLY IF SELLING PRESSURE ENSUES 1587
(08:18) Matt Reynolds:I CAN COVER THE BALANCED OSCILLATION AREA DN THE NEUTRAL ZONE THEORY STUFF AGAIN LATER TODAY
(08:18) Matt Reynolds:SUPER IMPORTANT THAT EVERYONE UNDERSTANDS HOW TO APPLY
(08:19) Matt Reynolds:THERE WAS NO BUY AT THE OPEN BECAUSE ES NEVER CLOSED ABOVE THE MIDPOINT BETWEEN PIVOT AND MR1
(08:20) Matt Reynolds:HAD TO EXPECT PULLBACK TO PIVOT AND AN ATTEMPT TO BREAKOUT OF THE BALANCED OSCILLATION AREA IN THE OPPOSITE DIRECTION
(08:20) Matt Reynolds:SIMILAR TO WHAT WE SEE WITH THE PZ
(08:20) Matt Reynolds:IF IT CAN'T BREAK ONE SIDE IT NORMALLY WILL GO TEST THE OTHER
(08:21) Matt Reynolds:BALANCED OSCILLATION AREA CAN BE VERY SIMILAR OR FUNCTION VERY SIMILAR
(08:21) Matt Reynolds:THEY SHOULD TRY TO TAKE THIS BACK UP TO 94 TO 96 AREA
(08:21) Matt Reynolds:MOST LIKELY
(08:22) Matt Reynolds:THEN SELLERS WILL START TO RE-ENTER
(08:22) Matt Reynolds:KEEP IN MIND
(08:22) Matt Reynolds:BULLS IN CONTROL ON THE WEEKLY PROFILE
(08:22) Matt Reynolds:HOWEVER WEEKLY HAS MADE A BEARISH BREAKOUT
(08:22) Matt Reynolds:SO WE EXPECT IT TO RETRACE AND TAKE ANOTHER LEG DOWN
(08:23) Matt Reynolds:WITH BULLS IN CONTROL AND PZ UNDER THE MOVE WE WILL MOST LIKELY SEE A SPIKE IN VOLATILITY DURING THE BEARISH CONFIRMATION WAVE ON THE WEEKLY
(08:24) Matt Reynolds:MAKE SENSE
(08:24) Matt Reynolds:BEARS TRYING TO ESTABLISH OR CONFIRM DOWNTREND
(08:24) Matt Reynolds:WHILE THE BULLS ARE TECHNICALLY IN CONTROL OF THE MARKE T
(08:24) Matt Reynolds:THAT WILL DEFINITELY CAUSE AN INCREASE IN VOLATILITY
(08:25) Matt Reynolds:EVERY TIME YOU SEE IT
(08:25) Matt Reynolds:ON ANY PROFILE
(08:25) Matt Reynolds:SAME WOULD BE TRUE IF BEARS WERE IN CONTROL AND BOTTOM OF THE PZ WAS UP NEAR MR2
(08:25) Matt Reynolds:AND THE BULLS WERE TRYING TO CONFIRM UPTREND
(08:26) Matt Reynolds:SAME CONCEPT OPPOSITE DIRECTION
(08:26) Matt Reynolds:EITHER WAY VOLATILITY SPIKE
(08:26) Matt Reynolds:ANYONE WANT TO SEE EURUSD
(07:51) Matt Reynolds:LOOKS LIKE IT IS HEADING FOR THE TOP OF THE PZ ON THE WEEKLY
(07:51) Matt Reynolds:JUST AS WE EXPECTED
(07:51) Matt Reynolds:AFTER WE GOT THE CLOSE BELOW THE MIDPOINT BETWEEN THE PIVOT AND MS1
(07:51) Matt Reynolds:AND THE ES BEGAN MAKING A BEARISH BREAKOUT
(07:53) Matt Reynolds:I POSTED LAST NIGHT TO LOOK FOR THE ES TO TEST 1690 AREA
(07:53) Matt Reynolds:THEN SUPPORT WOULD BEGIN TO COME IN
(07:53) Matt Reynolds:AS ES APPROACHES THE TOP OF THE PZ ON THE WEEKLY
(07:53) Matt Reynolds:BUYERS WILL START TO ENTER THE MARKET
(07:54) Matt Reynolds:AND BULLS WILL ATTEMPT TO MAINTAIN CONTROL OF THE MARKET
(07:54) Matt Reynolds:WEEKLY DID NOT GET A CLOSE ABOVE THE MIDPOINT BETWEEN PIVOT AND MR1
(07:54) Matt Reynolds:SO THAT TELLS US TO EXPECT IT TO REVERSE TO THE PIVOT AND POSSIBLY ATTEMPT TO THE DOWNSIDE
(07:55) Matt Reynolds:IT IS FAILING TO BREAKOUT OF THE BALANCED OSCILLATION AREA
(07:55) Matt Reynolds:NO CLOSE ABOVE THE MIDPOINT BETWEEN PIVOT AND MR1
(07:55) Matt Reynolds:SEE HOW IT TOUCHED IT AND THEN CLOSED BELOW IT
(07:55) Matt Reynolds:FAILURE EXPECT REVERSE TO THE PIVOT
(07:56) Matt Reynolds:I WOULD NOT BUY THIS THING UNTIL THE DAILY FAILS TO THE DOWNSIDE
(07:56) Matt Reynolds:AND IT HAS NOT YET
(07:56) Matt Reynolds:STILL HAS TO RETRACE AFTER MAKING BEARISH BREAKOUT
(07:57) Matt Reynolds:STILL WANTS TO TEST TOP OF PZ ON WEEKLY LOOKS LIKE
(08:08) Matt Reynolds:SOME BUYERS CAME IN NEAR MS3 AND TOP OF PZ ON WEEKLY
(08:08) Matt Reynolds:HENCE THE LONG WICK
(08:09) Matt Reynolds:INTERESTING THING EURUSD IS ABOVE THE PIVOT AND INCREASING IN VALUE ON YEARLY AND QUARTERLY PROFILES
(08:09) Matt Reynolds:ALSO ABOVE TOP OF PZ ON QUARTELRY
(08:09) Matt Reynolds:AND ATTEMPTING TO MAKE BULLISH BREAKOUT
(08:10) Matt Reynolds:MAYBE WE ARE GOING TO START SEEING THE ES AND THE EURUSD GO INTO A NEGATIVE CORRELATION PATTERN
(08:11) Matt Reynolds:IT HAD BEEN POSITIVELY CORRELATED IN THE PAST
(08:11) Matt Reynolds:MEANING THEY MOVE IN TANDEM
(08:11) Matt Reynolds:NEGATIVE CORRELATION THEY MOVE OPPOSITE
(08:11) Matt Reynolds:KEEP AN EYE ON THIS
(08:12) Matt Reynolds:THIS WOULD BE A MAJOR CHANGE
(08:12) Matt Reynolds:IF THIS NEGATIVE CORRELATION HOLDS
(08:12) Matt Reynolds:THINK ABOUT WHAT THAT MIGHT MEAN
(08:13) Matt Reynolds:IF THE EURO IS MORE VALUEABLE AND INCREASING IN VALUE AGAINST THE US DOLLAR
(08:13) Matt Reynolds:NORMALLY EUROPEANS WOULD CONVERT EURO TO US DOLLAR THEN BUY US STOCK
(08:13) Matt Reynolds:BUT IF STOCK INDEX GOING DOWN AND EURO GOING UP
(08:14) Matt Reynolds:THAT IS POSSIBLY HINTING THAT EUROPEANS ARE RELUCTANT TO BUY US STOCK
(08:14) Matt Reynolds:EITHER THEY FEEL IT IS ALREADY OVER BOUGHT
(08:14) Matt Reynolds:OR THEY ARE WORRIED ABOUT WHEN THEN SELL THE STOCK THEY WILL GET PAID IN US DOLLAR.
(08:15) Matt Reynolds:AND THE US DOLLAR COULD BE IN FOR SOME MAJOR DECREASES IN VALUE
(08:15) Matt Reynolds:WITH THE CONTINUED INCREASE OF THE NATIIONAL DEBT
(08:15) Matt Reynolds:AND CHINA'S RELUCTANCE TO BUY OIL AND OTHER COMMODITIES IN US DOLLAR
(08:16) Matt Reynolds:THE CURRENT WORLD DENOMINATED CURRENCY
(08:16) Matt Reynolds:IF THIS NEGATIVE CORRELATION HOLDS THEN EXPECT STOCK INDICES TO PULL BACK ES COULD GO TO THE PIVOT ON THE QUARTERLY
(08:17) Matt Reynolds:1641.00 AREA

Derivative Concepts: COTTON AND NATTY GAS

Derivative Concepts: COTTON AND NATTY GAS: Back on the 25th of January the post below on Cotton and Natty Gas went out recommending to enter buy signals and to expect higher prices i...

ESH13 3-4-13

The ESH13 failed to make a bearish breakout simultaneously on both the Weekly Profile and the Daily Profile.  No candle body close below the midpoint between MS1 and MS2 which generates a buy signal as the Zone-Trader applies Rule 8 and expects the market to revert back to the Zone-Trader Pivot the Weekly ZT Pivot was at 1517.25, and the Daily ZT Pivot was at 1513.25.  The buy signal was generated at 1512.75.  Also the market opened inside the PZ on both the Weekly Profile and the Daily Profile so the bulls and the bears were fighting for control of the future direction of the market.  On the Weekly Profile the market was trading above the midpoint of the Persistence Zone in the bullish half of the defined area giving upside strength or bias.  On the Daily Profile the market was oscillating around the midpoint of the PZ then made a move to the bottom of the PZ but the bears failed to take control of the market the time filter did not hold below the bottom and this occurred simultaneous to the failed bearish breakout, providing the Zone-Trader with alignment between the Directional and Control Bias's.  The market reversed as was expected and then proceeded to trade back to and break above the top of the PZ and held the time filter telling us the bulls had taken control of the market on the day.  The market also broke above the top of the PZ on the Weekly Profile and the bulls are currently still attempting to take control of the market on the week.

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