Nasdaq trade explained 01.07.2021

Instrument : E-mini Nasdaq futures

Date : 2021-01-07 10:00

Below are some screenshots of a 4 minutes scalp I took this morning for educational purpose. I hope you will get some value from it.

I first noticed on the M5 chart that :

  1. we had a divergence with some buyers coming in (Cumulative volume delta doesn’t show some heavy buyers yet so we are not going to play a long move though)
  2. we had a high volume node at 12670 supporting the price. This confirmed a potential buying interest at 12670 and this helped me to place my stop loss slightly below 12670

I broke down on a Range bar 15 chart to get some more insights and noticed that :

3. We had a buying divergence below this (key) 12670 level
4. I missed the buy entries around 09h42 and 09h52 because I was not looking a my charts, but I entered a buy at 10h02 when the price started to rotate up again with a nice pin bar in price and delta with a stop loss below 12670. My target is just below the VWAP, but I monitored 12700 level for a potential manual close at this level because round numbers are often key levels for bounces.
5. Note that we had some sellers trying and failing to push the price down along the way, that’s a warning that confirms we are certainly not going to hold this trade for too long.

And then… as a result we had some big buyers coming in (this fat green bar in delta) and a nice up move that went straight to our take profit level for a 4 minutes trade duration!

PS : it’s fun to note that we could have even hold the trade up to 12713 because we had a nice divergence with sellers coming in 🙂

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