S&P Easy Emini Day Trade Set Ups-E BOOK

EASY EMINI ES TRADE SETUP The key to successful trading is to have a trading plan and a set up that gives you the confidence to take the trades trades as they come along. I am making no guarantees but if you can be patient and wait for the set ups described in the e-book you will be profitable more often than not. There will always be losses but but you use a stop knowing what your maximum loss is going to be and you let your winners run. www.easyeminitrade.com [email protected] http://www.youtube.com/user/easyeminitrade

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Disclaimer No part of this publication may be reproduced without written permission by the author. The purchaser will not disclose any of the trade set-ups or any other confidential information obtained from the trading philosophy and settings obtained from this publication. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is said with the understanding that the publisher is not engaged in rendering professional service. If professional advice or other expert assistance is required, the services of a competent professional should be sought. No representation is being made that any account will or is likely to achieve profits or losses similar to those charts that are shown. There is a risk of loss in all forms of trading. Futures and options trading have large potential rewards, but also large potential risk. You must be aware of the risks and be willing to accept them in order to invest in the futures and option markets. Don’t trade with money you can’t afford to lose. This is neither a solicitation nor an offer to buy/sell futures or options. The book you will be buying is published for educational purposes only. It is up to you to use the knowledge. Consult a licensed professional about your individual trading. The past performance of any trading system or methodology is not necessarily indicative of future results.

Emini (ES) easy trade setup these set ups work when the market is up, down or sideways Below are 2 different trade setups that I use to trade the ES. One is set up to catch the larger moves and the other is for strictly scalping. I am sure you will all agree that we are all looking looking for the Holy Grail for the perfect trade set up but there is no such thing, all we can do is find the best set up that works for us and our personality and our style of trading. I hate to admit it but over the years I have spent thousands and have purchased and tried and subscribed to more services and programs and education than I care to mention. I know I am not alone. alone. We are given empty promises and the people and companies selling their programs are just in it to make money all while trying to convince us that they have our best interest at heart and all they just want to help us. If that were true they wouldn’t charge hundreds or even thousands of dollars to help us. What I am about to share with you is a simple setup that works more times than not when you follow the trade setup and rules. Once you use this this setup you I think will will agree. I suggest trying trying it in a simulator account or paper trading it until you get the feel for it. It is simple but the key is going to be to follow the rules, following the rules can be difficult when you feel like you are missing the move and everyone is making money but you. I promise you are not missing missing anything; a new











chat room once your charts are set up. This will assist you in under standing the set ups and allow for you to ask questions. Also please view the videos on YouTube, that will will also be a help. First we will set up 4 charts: charts : I use candlestick charts just because that is my preference but you can use bar chart if you prefer. Personally it is just just easier for me to see where price is closing using candlesticks. Chart #1 – 60 minute chart – 1. Place a 9 period weighted moving average on the chart (white line on my chart) 2. (This is optional) add the indicator in Trade Station called automatic trend lines (pictured on my chart as red lines are resistance and blue lines are support) (we just use the default settings of 4, 4, 10) If you don’t use Trade Tr ade Station I am sure you have this indicator with whomever you use, on this particular time frame I just like these for a reference, we don’t use it for entries.

I use this chart to determine where there might be an area to my left where I might get a price stall, I do not take trades off this chart but I look at this when considering trades off of one of my other charts. When entering a trade it is important to look at a longer time frame such as the 60 minute chart to get a broader view of price movement. When looking at the chart above you will see the white lines drawn. These represent areas where price had a strong support or resistance area and price price could likely stall here. So for example if taking a short right in an area where there is strong support below you, it is likely price will bounce and you will be stopped out. Looking at the chart below you will see a white line drawn. If you were taking a long entry off of 200 Tick or 3000 Tick charts and you saw this on the 60











Chart #2 – 3000 tick – tick – chart setting time of start 16:30 and end time 16:15 1. Place a 55 period simple moving average on your chart (magenta line on my chart) 2. Place a 9 period weighted moving average (white line on my chart) 3. Add the indicator in Trade Station called automatic trend lines (pictured on my chart as red lines are resistance and blue lines are support) (we just use the default settings of 4, 4, 10) If you don’t use Trade Station I am sure you have this indicator with whomever you use 4 Add the MACD (Trade Station default settings 12, 26, 9) 5. I also always on my 3000 tick chart draw a horizontal line for the previous days High, Low and Close based on chart start time of 16:30 and end time time 16:15. Most platforms platforms offer an indicator called previous days OHLC or Daily OHLC, something along those names. I do not plot the the open, just the high, low and close. If you would like to look these up each day if you don’t have an indicator you can subscribe to www.pivotfarm.com it is free. (thanks JP)











We use this chart to take an entry for our trend line set up and also determine whether we will be long or short when using the scalp trade set up. We never take a long if the price is under the white and we never go short if price is over the, unless the price is in between the 2 moving averages we can take the scalp trade set up described later but never against the 9 period moving average. If price breaks resistance (red line as pictured above) we we look for long entry and if price breaks support (blue line as pictured above) we look for a short entry.

Chart #3 – 2 minute chart – chart settings time 9:30 end time 4:15 1. Automatic trend lines (Optional, same as you did on the other 2 charts) I use these just as a reference, 2. Plot the additional symbol $tick on your chart or you can put it on it’s own chart (you might have to get your account enabled for this). Here is the short definition of the $tick; it summarizes the number of stocks on the NYSE that are increasing in price versus those that are decreasing in the price from the previous price quote. I use the $tick in a very simple capacity, I do not take take longs if the reading is negative and I don’t take shorts if the reading is positive. The exception to this rule is when we have extreme readings. We do not want to take take trades when our readings are +/- 900











3. Add ADX to this chart and use the settings of 14 for length and 20 trending value (which means that you will have a horizontal line at 20) . If the the ADX is over 20 I consider this trending. You can use any ADX indicator with the above inputs or if you like I have an .ELD file that I have attached to email that delivered this book to you. Some people like to use 30 to show trending but I use 20 to show trending or not. I like to just glance and see if itit is heading higher. I draw a horizontal line at 18 and 20 and if ADX is heading higher from 18 I will take a trade when entering off my 200 tick chart. (Described later)

We use this chart to determine if we will take our scalp trade off the 200 tick chart (next chart). I will only only ever enter a trade long or short if the ADX is over 18 18 and rising or close to 20 and moving higher. I will only only take a long scalp trade if the $tick has a positive reading and trending higher (more info on this later) and I will only take a short if the $tick has a negative reading and trending lower. lower. With the exception of the extreme readings as explained earlier.

Chart #4 – 200 tick – tick – chart setting time of start 16:30 and end time 16:15 This is the chart we use to make our entries and set our stops for the alternative entry for the 3000 tick set up and the scalp set up. I use this chart because itit keeps our stops tight and our entries accurate. 1. (Optional) Insert automatic trend lines (you can use these for reference), 2. Insert stochastic slow (using default settings in Trade Station of 14, 3, 3, 1, 80 (for over bought) and, 20 (for over sold) or you can use 14, 6,6, because of all the different data providers that we are all using the indicators sometimes appear differently differently for many of us, this setting will will smooth













can’t use the info for the squeeze that I have attached you can use Keltner Channels (set at 15 and 1.5) and Bollinger Bands (set at 15 and 2.0) and a momentum index Oscillator (12 or 14 periods on the close). The way I found the squeeze indicator is I did a search in Trade Station forum, you can do the same for whatever platform you are using. Search for Squeeze or Bollinger Band Squeeze or John Carters indicators, or Mastering the Trade indicator, more than likely you will find something, if not you can use the alternate indicators described at the end of the eBook, also picture of chart. 5. Draw a horizontal line for the previous days High, Low and close based on chart settings of start time of 16:30 and end time 16:15. Most platforms offer an indicator called previous days OHLC or Daily OHLC, something along those names. I do not plot the open, just the high, low and close. I will usually wait for price to break those if I am considering taking a trade close to any of those when entering from the 200 tick chart. For example if a short was setting up but it was very close to the low of the previous day I will wait for it to break below that and then look for my scalp set up. Chances are that the price is going to bounce around these points before breaking so my style is to let it break then take the pull backs with confirmation. 6. Add the pivot high and pivot low indicators (Trade Station default settings of 3, 3), if you don’t have this with your platform you might find it as higher h igher highs and lower lows or swing highs and swing lows.











So now that you have all your charts set up here is how you will use them all and make your entries. Make sure you save your charts. Trade set up for to catch big movers – trend line breaks 1. First you look at the 60 minute chart to get a brief over view of the previous price action and where there might be a price stall as described above under the 60 minute charts. 2. Next look at the 3000 tick chart and see if price is above or below the 9 period weighted moving average (white line on the chart chart below). This saves you from being whipped whipped around back and forth making many trades that don’t go anywhere. See the example below by #4. We do not go against the white moving average on the 3000 tick chart even for scalps (which will be described later). Price above, we are looking long, price below, we are looking short. 3. On the 3000 tick chart the MACD (on the example below) green line should be under the purple color line for shorts and preferably below the 0 but not a requirement and for longs the green line should be above the purple line preferably above the 0 line. See the example below by #4. 4. Next we look for a break of the support or resistance lines (these are the blue trend lines pictured below) we look for longs when we have break of resistance (trend lines above our head) and break of support (trend lines below us) we look for shorts. When one of these trend lines is broken and the price bar closes above or below the trend lines we…











5. We then wait for the price bar that has broken the trend line to close. We then verify the MACD is in alignment for the trade we are looking to take. For example once the bar that broke the resistance trend line (line above our head) is closed we enter using a buy stop for .25 above the high of that bar when going long and we use .25 below the low of that bar for for our initial stop. Then as price moves higher you can trail your stop using .25 below the low of each bar as it completes. When going short we wait for the bar that broke the support trend line (line below us) to close, we then enter using a sell stop .25 below the low of that bar and use .25 above the high of that bar as our initial stop. Then as price continues to move lower you can trail your stop using .25 above the high of each bar as it completes. Alternative entry to above set up – drilling down to the 200 tick chart for entry so you have smaller stop

6A - Short entry - Once all the criteria listed above for #2, #3 and #4 have been met you now look for entry on the 200 tick chart. We want both Stochastic lines to be in the Over bought area (over 80) and have come up to the horizontal line you hand drew on your stochastic at 90 and now heading lower and come back down below the 80 line or we would like to get price divergence on the Stochastic. In the case of shorts divergence means the price is not moving lower but the Stochastic is which will usually signal price will follow. follow. We also want the MACD yellow line to be below the cyan line (based on the colors below, yours might be different colors) and moving lower just as in the example below. See the example for short entries.











example those are the colors used). Once the Stochastic and MACD are in alignment you can short. If the Stochastic had gone sideways in over sold for a few bars before the MACD MACD got in alignment I would pass and wait for the next set up. We do not want want the price going sideways in over sold when we are looking to enter a trade short, if we are already in one that is ok.

In the explanation above for a short entry – this would be a short entry without having divergence. All criteria are met on 3000 Tick chart and we drill down to the 200 tick chart (pictured above) after you get a trend line break on the 3000 tick chart and the MACD is in proper alignment on the 3000











Above is a 3000 tick chart, you can see we have a long set up. It has broken through Resistance (red line) and price is above above 9 WMA (white line). We now enter in .25 above the high of the bar that closed above the resistance line off of the 3000 tick chart or you use the alternative entry method described above and pictured below. You would want to see the entry below on the 200 tick chart after the bar closed above the trend line on the 3000 tick chart.













needed on 200 tick chart for entries, they are optional and just used for reference) but the stochastic is moving higher not not lower? That will usually mean that price will follow the stochastic higher (of course you are using your other charts and indicators to enter not just this one. The MACD yellow is above the cyan line (colors used in the example above). If you don’t have divergence you may enter long off the 200 tick chart when both Stochastic lines are in the Over sold area (under 20) and have come down to the horizontal line you hand drew on your stochastic at 10 and now heading higher and come back up over the 20 line and heading higher (we don’t need the squeeze indicator for the set up) . See picture below











against the direction of your trade. So if you are long if the MACD yellow line crosses below cyan then exit. Do the opposite for short exit. exit. Another way to to exit is to put a 9 period weighted weighted moving average on the 200 tick chart and use that to trail trail your stop. If the price closes above or below it you are out. The 2 set ups in this eBook will get you 2 to 3 trades per day and the key is to be patient. This is difficult for many traders traders because they think they are missing something. I understand completely. nd Here is the 2 set up for scalps. Requirements are almost the same on scalps except we don’t have to have the trend line support and resistance breaks on the 3000T chart and we use an additional indicator and we require price to be above or below both moving averages on the 3000 tick chart. Otherwise entry requirements are the same.

SCALP TRADE SETUP Your 200 tick chart is set up as described at the beginning of the eBook, we actually have 2 ways to enter the scalp trade, one way is you will will use the BB Squeeze indicator indicator along with Stochastic or we can enter using just the Stochastic. 1. The squeeze will show on the 200 tick chart when you see at least 2 red dots on the squeeze indicator (the more red dots usually means a more powerful move) followed by blue dot (you want the price bar that is forming at the blue dot to complete before entering a trade). If the momentum oscillator is green at the blue dot d ot it means you will go long if the momentum oscillator is red at the blue dot you will go short. When all is confirmed on all charts and I get the squeeze indicator to set up once I have my 1 blue dot and the next price bar is forming, I place a market order and enter as soon as the set up bar is complete (same entry technique as described above). As momentum slows the oscillator will go from bright green to dark green or from bright red to dark red, we don’t











We can actually enter into this trade 2 ways. ways. One is using the squeeze squeeze indicator as mentioned above and have Stochastic in alignment and the other way is to enter using the Stochastic as described under 6A and 6B (but we don’t need #2, #3 or #4 criteria mentioned in 6A or 6B) with out having having the squeeze firing firing off. We still follow follow all our other other rules mentioned above under scalp trade but if Stochastic is in alignment (as mentioned in 6A and 6B) and we don’t have a squeeze firing off we can still take the trade. I exit this setup the the same way as described above. As mentioned above, some people like to trail using the 9 period weighted moving average which does work well on this setup since it is a scalp. Here is an example of a short squeeze:





















Here is an example of a long squeeze:

































5. Is the MACD yellow line above cyan for long or is yellow line below cyan for short Enter .25 above the the closed bar for long or .25 below the closed closed bar for shorts 6. If drilling down for tighter entry - On the 200 tick chart has Stochastic gotten above 80 and reached 90 and now heading down and crossed back below 80 for a short or divergence down for short or has Stochastic gotten below 20 and reached 10 and now heading higher and crossed back above 20 and moving up or divergence up for long? Make sure MACD on 200 tick chart is in correct alignment also. If all these things check out make your trade and make sure to set your stop and make sure to take profits and don’t let the trade go against you.

Check List for scalp trade set up











SetPlotColor(1,RED); { Alert criteria } if Plot1 crosses over TrendingValue then Alert( "Indicator show trending" ) else if Plot1 crosses under TrendingValue then Alert( "Indicator show not trending" ) ; Easy Language for BB Squeeze [LegacyColorValue = true];

{@@14439@@}











{ A variation of an idea by nickm001 (Originally coded by eKam) that when Bollinger Bands (BB) fit inside the Keltner Channel (KC), a breakout is about to occur. It works on longer term charts, such as 15 minute to daily charts. This code creates an indicator that plots the ratio of BB width to KC width. When BB and KC widths are the same, the ratio (BBS_Ind)is equal to one (1). When the BB width is less than the KC Width (i.e. BB fit inside KC), the BBS_Ind is less than one and a breakout is i s indicated. An Alert Line is provided to indicate the level at which the trader considers that the "sqeeze is on" and a breakout is eminant. Coded by Kahuna 9/10/2003













alertTextID = Text_New(date,time,0,"d Text_New(date,time,0,"dummy"); ummy"); {-- Calculate BB Squeeze Indicator ----------------------} ATR = AvgTrueRange(Length); AvgTrueRange(Length); SDev = StandardDev(Price, Length, 1); Denom = (nK*ATR);

S&amp;P Easy Emini Day Trade Set Ups-E BOOK

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