3d:5m
-We are in a massive downtrend and found a bottom. You can see here that I have marked the low and how we created a higher high, then created a higher low, now pushing to a higher high. This setup is largely bullish WITHIN a bearish context. For that reason I wanted to find a good area to take a scalp long trade looking for a higher low setup. When looking for this higher low I wanted to have a good place to get an entry which wouldve meant that I had to look at the much smaller time frames.
1d:2m
-Here on the 2 minute chart you can see we had a large drop at the open and broke 4 areas of where we couldve bounced for a continuation long setup. Although, these breakouts were very weak compared to that very long large consolidation higher low breakout that is directly in the center of the chart. I took a long on this bottom move but only after a certain thing happened.
1d:2m 1st Trade: Trend Continuation Long
-See how we broke the low then immediately recovered? I took this long with a target of 5 points and a stop of 3 points. Only 1 contract. I got out WAYY too early as you can tell. I dont hate this trade since I made money on it but it is a fundamental error to take profits so quickly on a move where I couldve made over 150 dollars with 1 contract. Instead I only made 17 dollars simply because I am marketing in and out so there is a ton of slippage. I hit the exit button right at 5 points and as I hit that the MES dropped a full 1.5 points and I missed out on 7.50 in profits. Not huge obviously lol but improvements to be made nonetheless. This setup was quite tricky to take but also very nice because I am using a lot more continuation patterns to identify the underlying market structure which i think is what I should be doing from here on out.
Where Should I Have Taken an Exit?
-I shouldve left at the previous break of a lower low test.
Missed opportunities:
- very clear and clean extremely perfect higher high then higher low setup where we bounce off of the previous higher high. Awesome setup where I couldve made another 5 points.
1d:5m
2nd Trade: Trend Continuation Long
-Long off of this key level was very very nice. The trade was only meant to be a bounce but we have very many areas of confluence here. Let me explain: VWAP is right here as well as key areas on larger timeframes
10d:60m chart
-Very clear Higher low higher high setups here, head and shoulder formation at low then breakout to new highs all while holding higher lows.
Why did I exit where I did?
.
- My original target on this trade was 3960 but once I realized that we are making lower lows and lower highs I thought to myself "If this downtrend continues further where should I exit this scalp?" The answer was right at the previous breakdown through to a new low. If this trend was going to continue it was going to fail right there so I wanted to get out to mitigate that risk. Did I miss out on 5 points so far of upside? Yes. Was it a flawed idea? absolutely not. When trending these trades make perfect sense to me and I would rather take a tiny win than hold for some insane move of "back to the highs of day." We will see later on in the day if this is a flawed way of thinking. I do think that since we are still in a bearish trend on the 10 day chart that selling pops into rips is much smarter than expecting a massive move through the highs. Yes, Today I am playing longs on continuation from higher low and higher high but if you zoom out we are still in a very large downtrend so breakouts should still ~at some point~ be met with sell demand. Not a bad trade.
Missed Opportunity:
-Like i said earlier, we are still in a massive downtrend so it is expected that lower lows and lower highs should eventually come back into play. I saw this setup occuring and was expecting either a grinding green move higher or a slow decline back to 3960. We dropped very fast then popped back up and I thought we were going to fakeout to the downside but then moments later we spiked lower for 6 points. This was a really close trade that I just barely missed. If I had taken it and won that wouldve been a very nice day. Sadly, I did not.
Note: You can see that my 2nd long trade actually wouldve been almost a 15 point move had I held the whole way up to the 70s. I still think scalping that move was much better than holding for some insane move higher especially since we started trending down on the day and are still in massive macro bear market status.
