Thursday, 17 March 2011

EUROSTOXX- look to get long above 2750

Eurostoxx (March) 5min Double bottom pattern:

Eurostoxx Continous Daily:
Hits a 61.8 retrace (not taken from flash crash lows due to extreme readings)

I think this is a great trade in the making. We opened at 2725 and have traded as high as 2747 thus far. Short term res is 2745/2750. I am following 2 scenarios here:
i) Wait for a retest of the opening levels at 2730/2725 and look to get long. Price should not go lower than 2710 I believe to keep the bullish scenario intact. Stop 2695
ii) If there is no pullback to the open gap, I will be joining a breakout above 2750 after the cash market has opened.

This is a great trading opportunity. Successful traders learn to do something that almost no one else can do. They sell near the emotional extreme of a rally and buy near the emotional extreme of a decline. You have to be willing to do the uncomfortable thing in these situations if you really want to make money. The risk/reward here is great for swing longs vs entering new shorts. If we get stopped out- fine, we move on, focus on the next setup. 
Good luck