Monday Morning Briefing

Welcome to our morning briefing. Here we are reviewing short term setups ahead of the NYSE opening bell. If you are a scalper or swing trader then these setups may be of interest to you. As usual keep in mind that these are short term setups although they could be used as early entries for more longer term positions.

Equities are on the move this morning. My favorite setup is on the YM right now – here’s the context. You may recall that we had a Retest Variation Sell on both the ES and YM last week. That was triggered by a drop which however pulled back into a hammer formation. The RTV Sell stop is officially above the inside day candle’s high – however since we have a hammer (being potentially bullish) our stop should now be at 14534 on the YM – after which we also trigger a long setup.

What I like in particular on this setup is that the hourly panel lines up just nicely with the 100-hour SMA very close to our stop out point.

Same idea on the spoos however the hourly is lagging behind. Here we have the hammer high at 1555.25. As you can see as I’m typing this it has already pushed back above a stack of Net Line Sell Levels. That is potentially bullish in itself so unless things turn here in the next hour or so I have a feeling they’re going to burn the bears again today. But let’s not get ahead of ourselves – if you took the entry last week then your stop should be above the hammer’s highs. A breach above puts us in a long position – that’s simple.

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Cheers,