Pivots, Patterns, and Intraday Swing Trades: Derivatives Analysis with the E-mini and Russell Futures Contracts, + Website

CHAPTER 17

Trade Entry Models

The Trader must commit his funds at the right edge of the video screen. He cannot look ahead without suffering the prejudices of prediction, and he cannot look back very far before the opportunity has already come and gone. Thus, in order to reduce risk and limit his commitments only to those trades that stand the best chances, he defines a Trade Entry Model around a confluence of disparate technical market elements, which taken together might signal a trend continuation or reversal for the whole. This chapter is meant to bring together the various technical concepts explored in earlier chapters into that whole.

Many students who seek mentoring often reveal in initial conversations that they only monitor the one stock index futures contract they are actually trading. It's as if they expected their trading to improve by this singular focus. As regarding the additional effort, my experience in mentoring so many hundreds of traders over the years is that some are only too ready to dismiss as irrelevant something they would rather simply avoid expending the energy on to include. But even in the smaller intraday frames, the market will only complete a trend or pullback if most of the stocks that make up the market are willing to turn as well. The Dow, the NASDAQ and the Russell 2000 all focus on different segments of the market. The successful identity of an Entry Model requires a confluence of disparate technical events that involve the whole market in ...