The One Bullish Setup Everyone Must Know Daytrading Emini S&P

By Lawrence

If I am going to tell you that there is one simple day trading setup that works all these years you will probably think that I am kidding. What if I tell you that this setup is long only, strictly day trade from open to close? I must be joking, right?

Here is the dollar gain chart based on the setup. See it yourself.

ES Bullish Price Driver.


The Setup

 The rest of the article is available to our premium members only.
 Login or upgrade your membership to view this article now.


  • smilingsynic June 27, 2013 at 10:10 pm

    Interesting. Larry Williams used to say that the best trading strategy he knew was to buy on down days. This is somewhat a take on that.

    Years ago I wrote a system that studied the sum of one-day stochastics over a one day, two day, and three day period. Based on that experience, I have an idea: a system that buys on the open after a decline of 70 points on a one-day stochastic from the prior day.

    Taking your 23 level as an example (23 as a one day stochastic), buy 23(or lower) if the prior day was 93 or higher.

    Basically buying one day weakness after one day strength.

    If yesterday was, say, 60, no buys are possible, since 0 (the lowest possible) is only 60 lower.

    If yesterday were 84, buy only on 14 or lower (84-70=14).

    Years ago I noticed that this system was profitable. And I mean many years ago. I remember trading it on AOL back in 1997!

    I suspect that the principles are still valid.

    Hope this helps.

  • Lawrence Chan June 29, 2013 at 8:53 am

    One day stoch is simply where the close position is within the range, so the concept is similar in exploiting the bias.

    I can check if the flip of extremes like you described would produce better results.

  • smilingsynic June 29, 2013 at 6:26 pm

    I checked it myself last night on 2005-2009 data (out of sample). Your system at least in terms of total SPY points was much higher but on more trades.

  • Lawrence Chan July 2, 2013 at 11:05 am

    With back to back extremes (flip from one side to the other) it filtered out many trades but the winning percentage does not go up. S&P just likes mean reversion whenever it gets an excuse. =)

  • hossnabaii June 10, 2014 at 1:41 pm

    Hi LC does this model work whether next day is gap up or down?

    • Lawrence Chan June 10, 2014 at 9:12 pm

      It works on both.

      When gap down significantly, an all out meltdown could be in the making which are some of the worst losses this setup suffers. They are very rare though.These scenarios often trigger trend sell which we know what to do =)

  • Jeffreyvnlk May 15, 2016 at 8:13 pm

    Linda Bradford Raschke suggested 10%

  • You must be logged in to comment. Log in