The purpose of this is to serve as a closet, or attic, or self-storage facility. A place for me to store what I don't want to lose, all in one place, partly for me, but largely for those who may be interested in what I think about market stuff and trading stuff.
I've reserved the right to moderate comments. Assuming that this works, the point of it is to keep the blog on task as much as possible. Substantive questions will be answered, if I can, but good wishes and so forth will not be posted, not because I don't appreciate them, but because all of that is a lot for newcomers to wade through after a while, so please don't be insulted if you don't see your comment posted.
The first post is a link to a preview of my book. This may be of no interest to you whatsoever, but I do encourage those who are interested to at least look over it before plunking down any money for something that may be of little or no use to them.
Good trading.
I've reserved the right to moderate comments. Assuming that this works, the point of it is to keep the blog on task as much as possible. Substantive questions will be answered, if I can, but good wishes and so forth will not be posted, not because I don't appreciate them, but because all of that is a lot for newcomers to wade through after a while, so please don't be insulted if you don't see your comment posted.
The first post is a link to a preview of my book. This may be of no interest to you whatsoever, but I do encourage those who are interested to at least look over it before plunking down any money for something that may be of little or no use to them.
Good trading.
For Mar 27
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It appears that we are going to open within yesterday's volume range and price range, so the drill's the same as yesterday: buy support, sell resistance.
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Mid-day
0940 Hits and rejects the pre-mkt low.
0950 Rejects 13.5, then retests and rejects again.
0955 Testing pre-mkt low again but spending much more time down here.
1000 Testing the opening high again. Attempts to move higher fail quickly. Buyers just can’t get it together so far.
1005 Given that price has spent so much time at the bottom of yesterday’s price range, the likelihood is that we will drop out of this. Shorting breakouts absent news, however, can be unsettling. Waiting for volume increases the odds in one’s favor.
1010 If and when we fall out of this on volume, will look for first pause.
1020 And here we go, with a pause at 1803.
Price spent much of February between 1820 and 1780, so there’s a great deal of potential support throughout this range. However, the action on Monday may have created a short-term air pocket. So I’m using 1780 as support until the market tells me different (see chart I posted pre-mkt).
1030 Potential selling climax, which makes some sense, given that 1800 is the midpoint of the 1780-1820 range, and support could be found in this area.
1035 A continuation of the climax, or a secondary climax (the latter may seem like a contradiction in terms, but what may appear to be a climax in real time may be only tapping the brake; the decline can continue, though momentum may slow). This time there is a clear rejection of price, here at 1794, including a strong rebound. If a candlestick fan is into blending bars, there would be a hammer here.
1055 A higher low at 1050.
1115 We hover at the midpoint of the 1780-1820 range. For the time being, it’s acting as support.
1120 Higher lows.
1125 Higher highs.
1135 Price continuing to rise on moderate volume. Supply and demand lines can be useful here.
1145 And back to the opening low.
1150 And to the midpoint of the opening range.
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EOD
1210 Test of the opening low.
1235 And we make it to the top of the opening range. There’s no appreciable TD up here, but, again, a candlestick fan who blends bars would have a shooting star here.
1250 Lower high on pitiful volume and a break of the extended demand line.
1320 Another lower high.
1325 Another test of the opening low.
1340 And back to the midpoint of the larger range (1780-1820). Potential selling climax.
1345 Retest on lower volume and an immediate rebound.
1355 Higher low and higher high.
1405 Buyers can’t hold it.
1410 Buyers drive price back toward the midpoint. I should point out again that trading around this area may be difficult. Moves toward the midpoint from the extremes tend to be easier and more profitable than moves away from the midpoint toward the extremes. Therefore, as I’ve said before, anyone trading only one contract is going to bring a lot of baggage to the party unless he decides ahead of time whether he’s going to exit at a midpoint reversal signal and papertrade the rest of the day, or hold onto his trade and risk ending up at breakeven for the day, all of which has to do with the trader and none of which has to do with price action.
1420 And a test of the low of the day. Huge volume and another potential selling climax.
1440 And back to the midpoint. (See what I mean?)
1445 And no demand.
1500 And volume picks up to the downside. All of this is relatively meaningless, however. We’re pulling back and forth, six points either side of the midpoint, like a dog on a leash. Anyone trying to trade this probably has way too much time on his hands.
1530 Another test of the day’s low, and this time price isn’t bouncing quite so exuberantly, and demand is weak. Buyers are likely sweating here.
1540 And volume picks up to the downside.
1545 So we are six points from “support”, a slight TD, and 15m to go before the close. Do we exit? Or hold till the close?
1550 Demand not materializing.
1559 Still no demand, but this is good enough.
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It appears that we are going to open within yesterday's volume range and price range, so the drill's the same as yesterday: buy support, sell resistance.
.
.
Mid-day
0940 Hits and rejects the pre-mkt low.
0950 Rejects 13.5, then retests and rejects again.
0955 Testing pre-mkt low again but spending much more time down here.
1000 Testing the opening high again. Attempts to move higher fail quickly. Buyers just can’t get it together so far.
1005 Given that price has spent so much time at the bottom of yesterday’s price range, the likelihood is that we will drop out of this. Shorting breakouts absent news, however, can be unsettling. Waiting for volume increases the odds in one’s favor.
1010 If and when we fall out of this on volume, will look for first pause.
1020 And here we go, with a pause at 1803.
Price spent much of February between 1820 and 1780, so there’s a great deal of potential support throughout this range. However, the action on Monday may have created a short-term air pocket. So I’m using 1780 as support until the market tells me different (see chart I posted pre-mkt).
1030 Potential selling climax, which makes some sense, given that 1800 is the midpoint of the 1780-1820 range, and support could be found in this area.
1035 A continuation of the climax, or a secondary climax (the latter may seem like a contradiction in terms, but what may appear to be a climax in real time may be only tapping the brake; the decline can continue, though momentum may slow). This time there is a clear rejection of price, here at 1794, including a strong rebound. If a candlestick fan is into blending bars, there would be a hammer here.
1055 A higher low at 1050.
1115 We hover at the midpoint of the 1780-1820 range. For the time being, it’s acting as support.
1120 Higher lows.
1125 Higher highs.
1135 Price continuing to rise on moderate volume. Supply and demand lines can be useful here.
1145 And back to the opening low.
1150 And to the midpoint of the opening range.
.
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EOD
1210 Test of the opening low.
1235 And we make it to the top of the opening range. There’s no appreciable TD up here, but, again, a candlestick fan who blends bars would have a shooting star here.
1250 Lower high on pitiful volume and a break of the extended demand line.
1320 Another lower high.
1325 Another test of the opening low.
1340 And back to the midpoint of the larger range (1780-1820). Potential selling climax.
1345 Retest on lower volume and an immediate rebound.
1355 Higher low and higher high.
1405 Buyers can’t hold it.
1410 Buyers drive price back toward the midpoint. I should point out again that trading around this area may be difficult. Moves toward the midpoint from the extremes tend to be easier and more profitable than moves away from the midpoint toward the extremes. Therefore, as I’ve said before, anyone trading only one contract is going to bring a lot of baggage to the party unless he decides ahead of time whether he’s going to exit at a midpoint reversal signal and papertrade the rest of the day, or hold onto his trade and risk ending up at breakeven for the day, all of which has to do with the trader and none of which has to do with price action.
1420 And a test of the low of the day. Huge volume and another potential selling climax.
1440 And back to the midpoint. (See what I mean?)
1445 And no demand.
1500 And volume picks up to the downside. All of this is relatively meaningless, however. We’re pulling back and forth, six points either side of the midpoint, like a dog on a leash. Anyone trying to trade this probably has way too much time on his hands.
1530 Another test of the day’s low, and this time price isn’t bouncing quite so exuberantly, and demand is weak. Buyers are likely sweating here.
1540 And volume picks up to the downside.
1545 So we are six points from “support”, a slight TD, and 15m to go before the close. Do we exit? Or hold till the close?
1550 Demand not materializing.
1559 Still no demand, but this is good enough.
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Total Comments 10
Comments
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Thanks, Db. Dailies is ace. I'm catching up with you slowly.
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Better pick it up. I'm going to be after you to resume your journal (or blog).
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"Moves toward the midpoint from the extremes tend to be easier and more profitable than moves away from the midpoint toward the extremes. "
Thanks for that DB. |
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Keep in mind, though, that the "goal" -- for want of a better term -- is to reach the opposite extreme. However, there may be a reversal signal at the midpoint, and if you're trading only one contract, you may have to exit if you don't want to run the risk of having price back up on you and throw you out at breakeven. Your choices have to be made in advance, before you ever enter the trade in the first place.
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openWhen you say open within the previous day's range, what time do consider the "open" ? 8:30? 9:30? etc.
erie |
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0930 Eastern
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And to go along with eerie's question, what do you consider the opening range? Is it the first swing that price makes starting from 9:30 before it reverses?
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Also, one other question: do you ever draw boxes in your intraday 1-minute charts? Do you find the need to? I often see consolidations/rectangles intraday that seem to provide S&R later on in the day and I feel like drawing boxes around these helps illustrate the S&R.
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More or less. Beginners want definitions of these kinds of things, but to define them can be to divert attention from the purpose of the task, which is to determine the limits of price rejection. I'm content to wait for price to create a swing point, then wait again for price to test it. Regardless of whether price drops below it, reverses at it, or reverses ahead of it, I've learned something about how traders regard that price. And if any or all of this is taking place at prior boundaries, I've learned something else.
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No, but it's largely a matter of style. Since I like to quit trading early, there's really no need for me to focus on those congestions. They may be tested later, but by that time I'm usually done.
So, if they help you in whatever you're doing, draw them. Just remember that what is important is not the boxes but what the boxes are intended to illustrate, i.e., the congestions. |
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Recent Blog Entries by DbPhoenix
- Seven Habits of Ineffective Traders (05-13-2008)
- The Trading Log: Appendix (04-29-2008)
- The Trading Journal: Appendix (04-29-2008)
- The Trading Journal: Appendix (04-29-2008)
- Wyckoff the Great (04-26-2008)
