MNQH3 Trade on Dec 19, 2022 09:32 from BanalityOfEvil: Tradervue User Stock Trades.

MNQ – bounce off of major long-term support

PLAY

For THE OPEN I am looking to play a possible bounce in QQQ using MNQ, and will be watching the price action for a possible bounce trade off of 272.44 in QQQ. If this level does not bounce, look for signs that we breakdown into 270.47 or even further to 268.61

KEY LEVELS QQQ

short 272.44 / 268.61 / 270.47

long 272.40 / 275.60 / 277.70

CATALYST

QQQ is nearing long term support between 272.44 and 270.50.

TRADE IDEA

This is a major support area on the daily chart, so I am anticipating a bounce, especially since we have sold off the previous 6 sessions intraday.

SETUP QUALITY

B - major technical level, past due for some type of bounce, futures traded higher in the after hours session and a lot of people are expecting some kind of bounce

BIG PICTURE

We have a few gappers and the market may be looking to bounce today, but there is no major bullish macro catalyst to cause continuation higher. There is a chance we bounce today, but then probably move lower to close the day, or continue to move lower for the foreseeable future.

PLAN

Allow price to enter predetermined zone from trade plan (11313 – 11274). Wait for hints of a bounce to get long, setting stop below low of consolidation. Max target is a return to premarket highs at 11400.

REASONS TO SELL

Stopped out
Fundamentally negative major news hits the market
Buyers are not stepping up
Buying volume off of the bounce level is not overtaking the previous selling volume from the opening sell-off.

EXECUTIONS AND PRICE ACTION

@8:28 MNQ is trading down to premarket support area
@open MNQ is holding steady, selling off a bit into the opening minute near Fridays close of 11317. Will be looking to play the bounce at 1260
@8:32 buyers are stepping up at 1316, possible bounce area, took long with a stop at 1308
@8:33 stopped out, was way too early. will look to play lower around 1260 area, will be watching tape. wait for further confirmation next time.
@8:36 got long as QQQ and major market names are bouncing off of long term lows, multiple technical support, MNQ could possible move lower, but is bidding back up at the moment
@ 8:39 (forming a potential bottoming V, risking low of day 13pts. Max target is 11420.

if MNQ breaks down 1270 there may be a short down into 11160

@8:47 stopped out

@8:59 price has slowed and consolidated for 12 minutes, selling pressure declining right under Fridays lows. got long. @9:02 stopped out, horrible entry here. Not a good place to get long.

KEY TAKEAWAYS

1st entry was way too early, but I took it because lately when MNQ has reversed direction it has done so instantaneously and often with no potential for re-entry later. It has been putting in 30-50pt reversal candles... hard to trade. This was an attempt to manage risk properly, and I did just that. This is how the market has been behaving and I would take this entry again, with small size.

2nd entry was also a great entry, following my plan, except this time I waited for some confirmation. Buyers started stepping up but price did not follow through. This was a good entry. Unfortunately you set your stop too low which was ultimately hit. Don’t set stop so low. Always set stop below previous consolidation on a bounce play.

3rd entry was poor and unacceptable. Price was consolidating below predetermined price zone. If anything this could have been played as a scalp short, which would still not have been a good trade because of the low reward. This never should have been a long. You stopped out quickly and on purpose which was the right thing to do.

price moved below 270 before putting a bottom V at 11:30. Until further notice, retain a bearish stance on index futures position and continue to only trade short until further notice as your accuracy has been much better on these and the overall market is in a downtrend. trading long in this market will generally yield poor outcomes, especially in market indexes.

1st entry was not optimal, 2nd entry was perfect, but stop was set too low. Overall market analysis was incorrect. Continue to short the market until further notice. In a neutral or bullish market this bounce play probably would have worked. Do not trade long in this market. Period. The end.

Good job following your trading plan much more closely than you have been. Set proper stops next time.