The venerable S&P 500 (ES) futures market is tumbling again today as the new month gets underway.
So far, the bulls are nowhere to be found, and that potentially sets up the ES for more downside.
However, with the market at a short term low, there may be better entry opportunities for short ideas ahead.
So, let’s take a look at the chart and the bearish trade idea that could be setting up.
More Downside for the S&P 500 Index?
Here’s how we see the market for the S&P 500 Index futures contract developing…
The S&P 500 (ES) one hour time frame is in a down channel, with the market making lower lows and lower highs.
The market hit the bottom of the channel and is starting to push bullish towards the top of the channel.
Entry: Counter trend line break bearish near the top of the channel.
Stop: In the buy zone above the entry.
Once or if the market gives the entry, and as long as the market stays below the top of the channel, it will be a good idea to turn to the five minute time frame and to look for Tunnel Trader / Destination Trader / Chandelier Trader short ideas towards the daily support price point 3,749.75.
The Bottom Line
There are multiple ways to trade the futures, stock and other markets. We can trade the indexes, both up and down, as well as individual stocks…
But my colleague and equities pro Ross Givens has come up with a brand new strategy that aims to deliver weekly gain opportunities without ever holding a single stock.
If you’re interested, check out the important P.S. below…
For more on the markets as well as trading education and trading ideas like this one, look for the next edition of Josh’s Daily Direction in your email inbox each and every trading day.
I’ll be bringing you more of my stock and futures contract trading tutorials as well as some additional trading ideas.
And before you go, head on over to the Traders Agency YouTube channel for breaking market news, live trading sessions, educational videos and much, much more!
Keep on trading,
P.S. My colleague and expert stock trader Ross Givens just unveiled his brand new “rapid cash” strategy that is totally market neutral.
It doesn’t matter if a stock goes up or goes down… With this strategy, Ross can set up his trades to win in either direction.