Thursday, 18 February 2010

Why Trade the eMini S&P

People choose different futures to trade for different reasons. Traders choose a market to trade because they believe they will make more money trading that market than any other.

I think I have said that I have traded just about all the futures and FX markets over the years including Beans and Bellies. I have traded the cash, metals and stocks. I now mainly trade the DowEuro50 and the eMini S&P because of the above reason. These markets have large volumes = liquidity and open interest. They are hard to manipulate (note I said hard, not impossible) and a single trader has less effect in these markets than in most others.

In addition, the eMini is really smoooooth. If you look at the CVD of the chart below you can se that you can almost trade the market off the CVD. Add the EMAs and you really need nothing else. The CCIs are probably overkills until you trade some of the other markets when that momentum information is even more valuable.

Today's Trades. Putting in the P&L has been a real pain but I have been getting so many requests to put it back into the blog. I have decided that for the time being, I will mark the entries and exits on the chart as it was when we first started and put in a total points made or lost on the trade. This is a balance between providing the information a lot of people want and making the best use of my time. Each result will be based on a 3 contract entry, as before.

Each Trade is 3 Contracts Exit Types
Date 18-Feb-10
Trade # Points W/L
Trade 1 6.00 All Out
Trade 2 9.00 All Out @ Yesterday's extreme
Trade 3 0.00 whataMistaka2maka
Trade 4 2.50 Scale + Reversal Exit
Trade 5 10.50 Scale+KC+1.272
Trade 6
Trade 7
TOTAL 28.00 $1340


  1. Hi El n Kiki,
    Please explain how you managed to get into trade 4, the 8.30 sell-off was quite rapid

    thanks in advance

  2. Can you discuss at all how you determined that a range bar of size 1.25 was ideal for the ES.

  3. Any reason why you did not reverse at X3, this was a major pivot and was also right at the 1.272 retracement.

  4. EL,

    Thanks for taking the time to blog and post these, I know it must be added extra work at the end of a trading day. I (and I am sure most everyone who reads) really appreciates your kindness and willingness to share your insights.

    Thank you!


  5. Anon 18:20, that was a late entry from the bar before. Range Bars are predictable. Watching what needs to happen for your setup to trigger gets you in trades more easily.
    Anon 18:24, I found 1.25 by testing
    Anon 18:35, I stopped trading. I think Kiki was on it.

  6. Hello EL,

    First of all, thanks for your great and inspiring blog and work.
    I had a question for you, if you whould be so kind.
    When price is oscillating around horizontal EMAs and eventually breaks the range or consolidation.
    How do you know, when the break occurs.
    CCI is oscillating around zero,
    CVD is oscillating too.
    So what can you lean on, how do you know.

    Thanks again and best wishes for you and Kiki.

  7. Hello Tom,

    First of all respect for your work, knowledge and your blog.
    I had a question,
    I saw on your charts, that you often enter a trade when price breaks of a consolidation oscillating around the EMAs.
    How do you know, when to enter?
    I cannot make any use of the CCI in such a situation, because they are oscillating around zero.
    The CVD is often not clear to me, too.
    And if there is a bias, when to you enter,
    how do you know, when price is breaking out of the range and how do you differ that from
    failed attempts?

    Many thanks in advance and best wishes for you and Kiki

  8. Last 2 Anons, read the post for Friday 19th Feb