Update on this Russell 2000 trade idea:
- Two of the buy orders were filled
Two of the buy orders for the Long position got filled
- The average entry price, which is calculated by the average weighted entry prices (taking both entry prices and position size into consideration) is 1789
- Sept 7th, 8th and 9th, were bull candles with a healthy body and closing at their highs. The current pivot point on the daily chart seems to be the low of 07 Sept, which is 1778.7
- Russell 2000 futures (RTY) ended the week (the end of 09 Sept) at 1882.9, so the position is up 104.2 points, or 5.85%
- Some aspect of the "downside" of this trade plan, is that apx only 10% of our full budget was utilized. However, since there are potential trades on the market pretty much all the time, then, on the long run, this weakness is quite minor and can also be optimized by gradually raising the total budget per position allocation, as the trading or invesment account grows. How to do that is a seperate point and out of the scope of this article
- The original stop loss is 1628.9 and is now adjusted to the entry price, since it is far enough (over 100 points or 5% far away from current price)
- The original take profit of the trade idea is 1933.7 traders that are seeking to further optimize the trade plan may consider the following:
- Sell half of the Long at 1905 (since there is some potential selling pressure, even temporary, expected in the price range of 1905.5 to 1933, and that range is still below the original take profit target)
- Sell 25% of the Long at 1898.5 (just below the 1900 round number), another 25% at 1905 (as explained above), another 25% at 1936.5 (the original 'take profit' target of the trade idea), and the last 25%, to hang on patiently for a big one, all the way to Russlell at 2128, which would be an apx 19% move, or 339 points. The value of one point for one contract in the E-MINI RUSSELL 2000 INDEX FUTURES, is $50. In this example scenario, 339 points in the Russell futures, would be $16950, when trading one contract. And it would be a $1695 profit when trading the Russell 2000 micro contracts.
The original Russell 2000 technical analysis and trade idea (Long)
Russell 2000 futures (RTY) is at the bottom band of a potential bear flag but we are in the green (0.3% up so far today, on 30 Aug, 2022) and buyers may protect this touch point, and buy, which would expedite the short covering. The stop loss would be close, in relation to the take profit target, making this area interesting for a bull. See the channels and the technical analysis logic with the following video:
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