YM, ES and DJIA Analysis

[BlowFish]

Nicely done James. Looks like "they" want those stops above yesterdays high. It will be interesting to see if they can make one last push for it.

[DbPhoenix]

	Quote:	james_gsx
	I figured I should post a quick update. I got out of my position this morning as the ES and YM were unable to break support, and looked very weak in those areas. With 70+ pts in my pocket I didn't want to give a lot of it back, so I got out. I decided wait and see if the support broke - which it didn't - so I promptly got out. 70 pts isn't bad for a little over nighter, and overall I'm happy with my trade. I will also admit that I moved my stop at the open towards break even, mainly to eliminate the potential risk and lock in profits. We will see how things go at the close today, if price ends up hitting my designated target then so be it. I still made money for my bottom line, and at the end of the day that's what I see on my P&L. Unlike some people I will stick my head out and again provide proof of my trade. Accountability is a big issue on forums, and I want to show that if you properly use candlesticks with a positive risk/reward then it can pay off. Also for swing trades, it can be effective to drill down to smaller time frames to plan entries and exits. This wasn't the best trade, but it was a trade that still fit within my plan. Feel free to point out things that are wrong with it, or things that are right.

Watch that "smaller timeframe" talk.

Question: given your take on the nature of the activity at support, did you go long at 11:00?

[trader273]

	Quote:	DbPhoenix
	Watch that "smaller timeframe" talk. Question: given your take on the nature of the activity at support, did you go long at 11:00?

What the hell do you think you are doing HERE DB. This is for people who only, and I repeat, only use candlesticks. I have seen your charts and you use bar charts, how dare you!?!?! This is the "Candlestick Corner". First you are out to destroy the VSA thread, but luckily Eiger is there to keep you in check. Now I see you over here? I know what you are up to . Don't try to derail this thread either. We do not need anyone's view point but our own. We don't want to share ideas with other people unless they have the same ideas we do. What do you think this is, an open forum where people are free to express there opinions and thoughts?? I don't think so.


DB, I hope you see the sarcasm in this reply. It is in no way serious. We welcome everyone over hear that the candlestick corner. I just find it amazing that some people feel it is there job to try and control a thread or topic for whatever reason.

So hopefully you'll enjoy your stay and feel free to post whatver you want. God forbid, we might learn something new.

[DbPhoenix]

	Quote:	trader273
	DB, I hope you see the sarcasm in this reply. It is in no way serious. We welcome everyone over hear that the candlestick corner. I just find it amazing that some people feel it is there job to try and control a thread or topic for whatever reason. So hopefully you'll enjoy your stay and feel free to post whatver you want. God forbid, we might learn something new.

Yes, I did, and it's very funny. As for controlling threads, this most often arises out of a lack of confidence in whatever the individual is doing. Not referring to any thread or forum or website in particular, of course.

But I hope James takes the time to respond. Although if he's not a daytrader, I can understand why he might not take the long.

Funny thing is, I couldn't care less whether people use candles or bars or divining rods. It's all about the same thing: price action. The difficulties arise when the trader begins to think of these things as indicators (if he ever thought of them as anything else) and forgets what it is that they are indicating. It seems James understands this. At least that's what I got from his post.

And why no NQ? You guys wouldn't be prejudiced, would you?

[james_gsx]

I am on my cell phone so I will do my best to respond. I didn't take the long - because I needed to ice my shins and ankle from running I was in too much pain and couldn't stick around lo lame excuse I know.

Any other "normal" day I still would have not taken the trade simply because I don't like taking day trades on the 15min bar, I prefer the 5. I also know I would have a hard time holding something that long without getting out too early. Thats a lack of confidence on my part. I have plenty of confidence with my TA, especially on the daily time frame, but once I take the trade and I don't see immediate results I get figidity. I definitely need to work on trusting myself while in the trade just as much as I do doing the analysis.

I will say this trade today confirmed that I need to trade what I see and just go with it. But technically I still got out eary and thus we will have a huge down day tomorrow and I will feel like a fool

[DbPhoenix]

	Quote:	james_gsx
	I am on my cell phone so I will do my best to respond. I didn't take the long - because I needed to ice my shins and ankle from running I was in too much pain and couldn't stick around lo lame excuse I know. Any other "normal" day I still would have not taken the trade simply because I don't like taking day trades on the 15min bar, I prefer the 5. I also know I would have a hard time holding something that long without getting out too early. Thats a lack of confidence on my part. I have plenty of confidence with my TA, especially on the daily time frame, but once I take the trade and I don't see immediate results I get figidity. I definitely need to work on trusting myself while in the trade just as much as I do doing the analysis. I will say this trade today confirmed that I need to trade what I see and just go with it. But technically I still got out eary and thus we will have a huge down day tomorrow and I will feel like a fool

Thanks for the reply, and I understand. I was an EOD trader for quite a few years until the internet came along. Even then, daytrading wasn't cheap given the cost of the software and datafeeds (those who weren't there wouldn't believe how much it cost; remember when VCRs were nearly $2000?), so I didn't get into it until the late 90s.

And, no, I wouldn't daytrade off a 15m bar either.

As to the down day, who knows? Support, as you noted, is at 60 and resistance is at 80, with 70 being the midpoint. Since we closed near that midpoint, we just have to wait for the market to show its hand, or at least a couple of cards. Maybe you'll get lucky and it'll open near resistance.

[james_gsx]

That's another big issue that affects my day trading and sometimes swing trades - taking a trade in the middle of a range. I bought an ES put the other day in the middle of the range, knowing it was in the middle of the range - against a spinning top on support (midpoint) - dumb move and I paid for it lol

[DbPhoenix]

If I understand what you're saying, I've found that to be true as well, that if I enter a trade in the middle with the idea of exiting at support or resistance, the trade is much more difficult to manage than if I enter at one or the other of the extremes and hold to the other, or possibly unload at least some of it at the midpoint. Yesterday is a good example.

[zeon]

Given the talk about a potential long trade yesterday, and James' YM chart in post #238 ('inability to break support') I'd like to ask anybody what they think of the following. It's related to the same setup, but on the ES instead.

Dbphoenix also posted this in the VSA thread: 'long entry at double bottom off support and no supply at 11:00', but given the nature of the debate there it seems safer to post the question.

I actually had support drawn a bit lower, because of the highs on the 24th of March. It seemed like logical place and also there was some pre-market action around that level (1357 on the attached chart).

Now, I'm not clear on the 'double bottom' concept. Db, are you refering to this on the 1-minute chart (because I know you tend to use them) identified by the two red lines I've drawn? First being a high volume peak (potential selling climax) and the second one is lower volume but price closes way off the lows and rises on the next bars without much trouble. Is this what you are refering to when you talk about 'no supply'? The fact that the rise takes place without much trouble?

Or... does the double bottom refer to the first touch of support around the open and the second time around 1100. However, the second time price doesn't really go all the way to support, and if I were to consider a long there, it feels like taking a gamble. Price might as well go to 1357 and then reverse. I've seen it happen several times.

Next thing I did was draw a trendline, after the first one was broken another one. It strikes me that before the second is broken, price has failed to make a higher high ('x' on the chart). So when the line is finally breached, would the trader still have a reason to stay in a long trade? Despite that, 15 minutes later we rally up 10 points and after that it lookes like price has lost any sense of directional movement.

All comments or suggestions appreciated...

Regarding James' chart, support is drawn at 12540 but looks like slightly breached (price goes to 12528) and then recovers. On the ES it's a different picture, price looks well above support. Do any of you guys ever consider what happens in another market (YM/ES/DJIA/NQ) to pre-empt your plan?

[zeon]

A chart of the YM and ES has been posted, I might as well add one from the QQQQ (the ETF of the NQ) now.

It seems to me - could be wrong though - that this instrument is moving much smoother in regards to support and resistance (look at the pink line at 45.57). However, there don't seem a lot of traders around on forums (except for dbphoenix) that trade this market. Most tend to focus on the YM or ES.

Anyway, there's a huge surge in volume when price approaches support and I can't really say I see demand coming in, because price closes all the way down (this is a 5-minute chart of yesterday's action). The next bar however is very low vol, why isn't this just a pause for a continuation to the downside, but instead the beginning of a complete reversal? Just by looking on a 5-minute chart, I can't seem any justification for taking a long entry at 45.15.