Monday fake out

Trading notes for 2026-02-09

TL;DR

Executed a successful "Monday Fake Out" trade by waiting for the typical pattern where markets move one direction during London session (2am-8am), then reverse during early NY session (9:30-11am). Despite having a long bias, I waited patiently for confirmation after the equity open rather than entering prematurely, which led to a profitable trade capturing the move back to London highs.

Market Context

Monday presented another classic fake out pattern that I've been observing regularly in the markets. The setup unfolded exactly as expected: during the London session (2am-8am EST), the market moved in one direction to get traders positioned and leaning a certain way. Then, as we moved into the New York open and the critical 9:30-11am window, the market reversed course to take out either London's highs or lows.

This pattern has become increasingly reliable, and I'm seeing it emerge consistently across multiple asset classes, making it an attractive setup to capitalize on with smaller, targeted trades.

Thesis & Plan

My thesis centered on the Monday Fake Out pattern playing out across both ES and BTC. The plan was straightforward:

• Monitor price action from London open through NY open
• Wait for the initial directional move to trap traders
• Look for the reversal during the 9:30-11am NY window
• Enter long after confirmation rather than anticipating the move
• Target London highs as the exit point

The setup materialized perfectly on both ES and BTC. While I initially thought BTC might drift higher on Monday after some manipulation and then retrace at the Sunday open, it ultimately followed the same Monday fake out pattern as ES.

Entries & Exits

I entered my long position after waiting for proper confirmation. Specifically, I got long after the initial rally from the open retraced back and took out a 15-minute low. This gave me the signal I was looking for - the market had shown its hand by taking out the weak hands on both sides.

The entry came after:

• The 9:30 initial push higher
• A retrace that took out recent 15-min lows
• Confirmation that both ES and BTC were showing willingness to move higher

My target was the London highs, which provided a clear and logical exit point based on the pattern.

What Worked

Several key elements contributed to this trade's success:

• Pattern recognition: The Monday Fake Out setup played out textbook perfect across multiple assets
• Cross-asset confirmation: Both ES and BTC showed similar behavior, strengthening the conviction
• Patience and discipline: I resisted the urge to enter early based on bias alone
• Proper timing: Waiting for the market to open, show its direction, and then provide confirmation
• Clear targets: Having London highs as a predetermined exit point removed guesswork

What Didn't

This trade executed well overall, but there are always areas for improvement:

• Initial bias management: While I had a long bias coming into Monday, I could have been more flexible about direction initially
• Pre-market assumptions: My initial thinking about BTC's potential path (drift higher then retrace at Sunday open) didn't materialize, reminding me to stay adaptable

Lessons Learned

The most crucial lesson from this trade reinforces a fundamental principle of successful trading: patience over prediction. Even though I had a long bias coming into the session, I didn't let that bias cause me to enter prematurely or guess the direction before seeing confirmation.

Key takeaways for future Monday Fake Out setups:

• Wait for market open: Never enter based on bias alone before seeing how the equity markets actually open and behave
• Cross-asset analysis: Check multiple instruments (ES, BTC, etc.) for confirmation of the directional move
• Sequence matters: Let the market show the initial 9:30 push, wait for the retrace, then enter on the follow-through
• Trust the pattern: The Monday Fake Out has proven reliable enough to trade with confidence when properly confirmed

This trade exemplifies the power of combining pattern recognition with disciplined execution. The Monday Fake Out continues to be a high-probability setup, but only when traded with proper patience and confirmation. The temptation to anticipate moves based on bias alone remains one of the biggest threats to consistent profitability.

Moving forward, I'll continue to monitor this pattern while maintaining the same disciplined approach: wait for confirmation, use cross-asset analysis, and trust the process rather than trying to outsmart the market with premature entries.