Learn to Trade Emini Futures - Head And Shoulders Pattern
February 21, 2012 at 6:17 PM (QQQQ)(DIA)(SPY)(GLD)(SLV)
The S&P500 Emini Futures took a backseat today as all eyes were on the Dow Jones Industrial Average (DJIA) and the 13,000 level. The last time the Dow closed above 13,000 was May 19th, 2008. Although we did trade above 13,000 intra-day, the market sold off into the close so "Close, but no cigar". A more important level to watch perhaps is how the S&P500 Cash Index handles 1,370. While it may not receive as much press, of the two I believe it to be the more critical metric of whether the markets continue what has thus far been a very impressive multi month rally against a backdrop of angst and the proverbial wall of worry.
Definition of 'Head And Shoulders Pattern'
We don't spend a lot of time on specific patterns but occasionally one shows up so nicely it just seems wrong not to point it out. So what is the Head and Shoulders Pattern? According to Investopedia:
A technical analysis term used to describe a chart formation in which a stock's price:
1. Rises to a peak and subsequently declines.
2. Then, the price rises above the former peak and again declines.
3. And finally, rises again, but not to the second peak, and declines once more.
The first and third peaks are shoulders, and the second peak forms the head.
This video is so nicely done I feel compelled to share it with you -
While it is not my personal "go to" reversal pattern, the "head-and-shoulders" pattern is believed by many traders to be one of the most reliable trend-reversal patterns yet discovered.
The one we pointed out today during the Live Radio Broadcast was not only "picture perfect" but it appeared as the Dow was testing that all important 13,000 number.
SP500 Emini Futures Tweet
Last night on our Public Twitter Feed - @CFRN we suggested selling 1364 Stop.
At this point we Tweeted to consider locking in some or all profits. Did you?
Dow 13,000
CFRN Partners were presented with several dynamic trade setups on the Dow (YM) Emini Futures today as the world at large was transfixed by the cash index.
Opening bell -
Dow (YM) Emini Futures 02/21/12
Mid-morning
Dow (YM) Emini Futures 02/21/12
Early afternoon -
Dow (YM) Emini Futures 02/21/12
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