Afternoon,

The Russell 200o trended higher today, most likely in anticipation of the FOMC meeting which starts tomorrow with the interest rate announcement scheduled for Wednesday at 1:15 pm CST. So expect some more of today’s type of action through out the next day or so and for sure, be out of the market around the announcement time.

Let’s start out today with some more fib studies. The Russell 2000 e-mini’s opened flat and had a very big 3 minute bar up followed by 3 big bars to the down side with price stopping at the  127% fib area as measured from the pivot at 15:09 pm CST Friday (pivot 2) today the pivot 1 this morning at 8:33 am CST. The price reversed right at that area. Let’s consider what happened next and see if we could have developed an entry even though there were no pivots to draw a trend line through. First, we know that the 127% fib area is a strong support/resistance area. Second, the was a very bullish bar at 8:51 am CST. Some trade might have considered that as a possible entry but let’s see what happened next. The price rallied up though Woodies pivot (the yellow line) and then pulled back to that same area with a bullish bar set-up. A bullish bar set-up would be a red bar followed by a big green bar. Coupled all of this with the fact that price had just tested the 127% area and you could have entered above the bullish bar at 9:09 am CST. Did I jump in? Nope, just trying to get you to think of different possibilities that occur every day. Here is the chart.

Chart Of Possibilities

Click on chart to enlarge.

The first trade of the day happened at 9:24 am CST with a trend line break followed by a trader’s trick set-up. The trade was up 1. 60 points. Stop was moved to break even and the trade broke even.  By the way, there was 1.90 points from entry to the 1st high of day so plenty enough to make our objective. It just did not get there. Here is the chart for trade 1.

Trade 1

Click on chart to enlarge.

The market then waffled (yes, that is a technical term) for the next hour and finally broke the 1 st hour high with conviction. There was a trader’s trick set-up at 11:24 am CST with an entry of 724.70. Notice on the following chart how once the price broke through the 1st hour high, that area became support. The price then traded up to the 127% fib area as measured from the high TS pivot at 10:03 am CST to the low TS pivot at 8:48 am CST. When the price turned down after that level, I got out on the bar at 11:33 am CST at a price of 724.90, so the trade made .20 points. Notice at the far right hand corner of the chart, after the 127% fib area was finally broken, that area became support. Here is the chart for trade 2.

Trade 2

Click on chart to enlarge.

The market continued it’s choppy ways, not allow for any real trending. The actual trend of the market was up but any individual moves were muted.

So for today, there were 2 valid set-ups with 2 break even trades for zero profit, ignoring slippage and commissions.

Let’s see how the fishing develops tomorrow. Do not expect too much until we hear what the all powerful FED is going to do.

Best regards and good fishing.

Ron

This is not a solicitation to buy or sell. 
There is a risk in any investment