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YMM1, (3, -1), profitable trade, fade 1st Stretch


Hi,
Basis YMM1 (June e-mini $5 dow futures), (3, -1) and fading the first two (3, -1) price moves:

Stretch calculation = 27
1.618% of the Stretch calculation = 43
2.618% of the Stretch calculaiton = 70
4.25% of the Stretch calculation = 114

Trading from unchanged:
12427 - 27 = 12400 (12397 = low 26 April. Reversing back to 12427:
12427 + 27 + 27 + 27 = 12508; and for fun 12508 +27+12535 +27 = 12562.
12560 = high of 26 April

Additional fun: 12427 + 46 + 46 + 46 = 12565 (12560 = high 26 April)
46 = 1.618% of the Stretch calculation for 26 April.

Today was a news driven price rally, with an interesting reversal from the high, which I'll mention after a brief interlude, again.

Trading from unchanged, 12427 + 123 = 12550 = 12427 + 4.25% of the Stretch, an exact match at the first high, before a 39 point pullback reversed back with the trend to make a new high, 12560. Price moves approximately equal to 4.25% of the Stretch tend to define a daily trading range. From unchanged, prices rallied that respective 4.25% plus an additional ten points to print the high, 12560, before correcting 43 points to settle at 12517. 12560 - 1.618% of the Stretch = 12560 - 46 = 12514. 46 = 1618% of the Stretch calculation.

The first micro move up, 12427 to 12445, was a 0.66% bounce. But that is of lesser importance (but does have some bearing which is explained below) because I always trade from unchanged. However, because both the corrolating price measuring projections indicated a low near 12400, .... -1.618% of the Stretch from 12445, projected a target... 12445 - 46 = 12399 (two ticks above the low, 12397 = 26 April low, and trading from unchanged, 12427 - 27 = 12400 = 12427 - the Stretch (three ticks above the low), ... this reflects a pattern that tends to repeat itself. Take note of this.

Basis YMM1 and trading from unchanged, 12427 - 27 = 12427 - 1.0% of today's Stretch = 12427 - 27 = 12400. 12397 was the 26 April low.

These two price measurements corrolated to nearly the same price, which was almost exactly the price low, 12397, for 26 April. On with the magic.

From the 12390 low, June e-mini $5 Dow futures (YMM1) prices paused at 12472. 12390 + 2.618% of the Stretch = 12465 = 12390 + 75 = 12465; seven points below the respective reversal high.

From 12472, YMM1 corrected lower to 12436, (a little more than the Stretch calculation, 27 points). From that intra-day 36 point correction at 12436, a brief rally continued, 12436 + 49 points to 12485, where a 40 point dip occurred, but I digress.

(Note: 12436 + 1.618% of the Stretch = 12436 + 46 points = 12482. That's close enough for thoughtful consideration, i.e., taking profits near 1.618% retraceals. Next a 40 point pullback followed that rally to 12485... but I digress. See above.)

This should touch on a few points of interest.