Wednesday followed an afternoon trend session downward on Tuesday. Often we see continuation in the same direction next day... but not this time.

ES (+$50 per index point)

S&P 500 futures bobbed around their daily pivot off the open, then worked their way upward thru the R1 value which then became support. An hour's-long sideways coil between 1289 and 1291 lifted to 1294 by session's end.

It was a low volume, upward bleed for most of the day. Stubborn shorts who tried to sell into a rising market like this (never us!) got stopped out repeatedly, and then wondered why they weren't merely net buyers upon reflection at 4:00pm EST. Good question... why do too many emini traders try to fight intraday trends? That's not trading. Shorting into uptrend sessions is stepping in front of a slow moving freight train hoping it will stop. Freight trains seldom stop on a dime, as reversal traders learned again yesterday.

ER (+$100 per index point)

Russell 2000 futures led the way all day. Another love fest for techs and small caps.

Buy signals above the pivot and above R1 were the working orders yesterday. No short signals once the early lift began... period. Buy or stand aside: those are the only two positions to take.

Summation
Still no clear break of the recent stale range, no directional bias as indexes churn mostly sideways for three months and counting. Volume was light all day, and accelerated into the final hour. Can we assume the same funds who sold off Tuesday on increased volume bought the market right back, very next day on nearly equal volume?

That's not something I find useful for making money. Just follow the clear signals and buy when they confirm, sell when they confirm and leave the rest of that stuff on the sideline. Bottom line is we have markets that are churning near a relative top or temporary stop before the next push higher. In either event, trading without bias with equal aplomb in either direction. No telling where the last two sessions this week may go... but we're nimble all the way!

Trade To Win
Austin P
www.CoiledMarkets.com
(Online video clip tutorials... open access)

Austin Passamonte is a full-time professional trader who specializes in E-mini stock index futures, equity options and commodity markets.
Mr. Passamonte's trading approach uses proprietary chart patterns found on an intraday basis. Austin trades privately in the Finger Lakes region of New York.