A Lesson in Reading the S&P Futures Market

Comparing Two Trading Days

Let’s examine the price action on two consecutive days to illustrate this point:

Thursday, June 6th

On Thursday, June 6th, the market essentially went nowhere. The open price was 5369, and the close price was 5365, resulting in a minimal four-point drop.

Friday, June 7th

In contrast, Friday, June 7th, saw tremendous price movement. The market opened at 5352 and closed at 5356, indicating a four-point rise. Despite the similar overall movement (four points up versus four points down), the daily price action was dramatically different. Thursday had little movement, while Friday saw significant activity.

Analyzing the Daily Trading Chart

When trading, focus on the daily trading chart between 9:30 AM and 4:00 PM. On Friday, the market opened at 5352 and closed at 5356. Although there wasn’t much overall movement, there was considerable activity during trading hours.

Understanding the Trade Opportunities

Despite the different price actions, the trade setup was almost identical for both Thursday and Friday. Knowing the trade setup is essential for trading these markets effectively. The key tool I use is the Taylor Trading Zone, which helps predict where the market is likely to go.

Using the Taylor Trading Zone

Before the market opens, I draw the Taylor Trading Zone on the chart. For instance, on Friday, June 7th, the intraday low was at 5341. By cloning the Taylor Trading Zone to this low, I forecasted the market would reach 5377-5378, which it did. This parameter is crucial for tailing the Trading Zone and predicting market movements.

The Gap Trade

Another important strategy is the Gap trade. This basic trade should be part of every trader’s toolkit. If you learn no other trade, learn the Gap trade.

The Importance of Trader Psychology

Trader psychology is vital. Looking at a chart in hindsight can be deceiving. A chart might show many opportunities, but during real-time trading, it can be intimidating. For example, a chart might suddenly drop with no prior indication. The Taylor calculator helps predict such drops, advising traders to exit and secure profits.

The Six Trade Setups

To trade effectively, you need to know all aspects of trading and what to avoid. I teach six trade setups in my trading course: Gap, Support and Resistance, Trend, Time and Price, Momentum, and Candlestick. If you don’t see one of these setups, you shouldn’t be trading.

Rules for Safe Trading

Rules are essential for safe trading. In my course, I recommend twelve rules, with six being critical. These rules are designed to keep you safe.

Conclusion

Understanding the market requires patience and a solid grasp of trading mechanics. Use tools like the Taylor Trading Zone and master key strategies such as the Gap trade. Always adhere to established trading rules to ensure safety.

This is Marv Eisen from Timeless Dollar Trading Academy. Trade safely and with patience. Thank you for watching, and I’ll see you in my next video.

S&P emini futures day traders need as much information as possible to make better trading decisions. Market prices move erratically, but the Taylor Trading Zone is based on calculations developed by George Taylor 75 years ago. 

Almost all professional traders use the Taylor Trading Technique every day to help them make profitable trades – because the trading zone has proven to be the next best thing to having a crystal ball. Click the banner below to for more information, read testimonials from users, and how to download your own Taylor Trading Technique Calculator.

Having as much information as possible gives S&P emini day traders a big advantage over “seat of the pants” traders. Without learning as much as possible about the market, it is highly unlikely that a trader will succeed at making money as a day trader.

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