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Dogpile

ES Trading for 10/15 thru 10/19 2007

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This thread is for discussing the major financial futures markets for the week. ES is the focus with NQ/YM/ER2 also watched closely.

 

We have a selling tail above the old all-time, creating a a resistance zone 1579-81. We have some likely support from Fridays low near 1563.75.

 

We balanced at 1570.00 on Friday, with a low-ADX 15-min Bollinger Band Squeeze type of set-up.

 

2 potential types of plays I see here:

 

Go long should we get strong upward momentum off opening price.

Wait for the first bull/bear flag type of pullback following a strong impulse move.

5aa70e10c0095_Oct12BBSqueeze.thumb.png.cfb0770411ffe2c590814f04b7b0ab91.png

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got a nice bear flag after strong momentum push lower.

 

Market then ran > 10 pts below 1570.00 pivot down to 1556.75.

 

1557.50 to 1558.00 was a very high volume area from 10/1 to 10/2 (those were daily PVP levels) so this made for some support.

5aa70e10cccc2_Oct151600tBearFlag.thumb.png.9ad6835a294d1db4b404c01c02f0065e.png

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If last Thursday's sell off was wave 1 or wave A and given today's impulse wave down, this could be either wave 3 or wave C which has the potential to become quite extended.

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If I may add. Given the panicky type of selling last Thursday, I would'nt be surprised to see a five wave down, which may become either a Wave A or Wave 1 of a higher degree.

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My apology to Dogpile. I understand this is a thread about Market Profile. I am not trying to turn it into a thread about Elliott Waves. As Dalton has said in one of his books that some days you have to throw everything out of the window. I brought it up because it may be the weapon of choice , at least for the near future.

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don't apologize, elliott wave does work enough to be useful. Not ruling that out by any means.

 

that said, 1553.00 appears to have some validity to it. would look for better ABC type of correction up and then maybe a short-scalp -- but day might be over in terms of the fun.

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Here is a look at the fight if you are to initiate a new short down here. Not saying that is what you are doing, just pointing out the problems in shorting in general at this level. I would almost expect a test up at this point and can short higher for a play back to test 1553.00 area.

 

http://bp0.blogger.com/_5h-SWVGx6Ms/RxO1gCyj7fI/AAAAAAAAAd0/-pFulX7q-bQ/s1600-h/Taylor+Summary+10-1+thru+10-15.png

5aa70e111b09a_TaylorSummary10-1thru10-15.png.4f07a16340f0c8d6a9dcb8ec2abeeff2.png

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Looking at today's action , I was anticipating a AB=CD Gartley type of formation from last thursday's high. But on both ES and SPY charts, the CD leg is not quite the length of AB yet. Does this mean we may have another down leg coming ?

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Ok, Dogpile must be out sick today. We now appear to be coiling around the VWAP, and the squeeze indicator also seem to be in effect. So expect a directional move soon.

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<<Is that a spreadsheet or came from a piece of software ?>>

 

spreadsheet I keep by hand. keeps me away from buying right into significant resistance or shorting right into significant support.

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I am looking at the longer term cash chart, it looks like we are finding support

at an Action/Reaction line here. There should be a nice bounce tomorrow.

On the other hand, if we gap down and have an open drive down early on, then a lot more selling can be expected.

Also a directional day is possible tomorrow after today's relatively symmetrical profile

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monster volume built (95k contracts) at 1548.00. This is the highest volume PVP in weeks by a large margin.

 

I am glad to see all that volume yesterday. There was a reason why CD leg

didn't quite make it to the length AB as I pointed out in one of my post yesterday, it was held up by this big support line I was talking about.

The situation was much like being squeezed between two major moving averages, all that volume means is that it is building up large amout of potential energy like a spring being wind up, once release. Watch out.

And Dogpile, pay attention to your flag.

Hopefully today will be a patriotic day.;)

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I shorted the gap back to 55. An auction between 55 and 60 would be nice, doesn't look like thats happening though.

This area below 55 looks like a mess to me.

 

Why is it messy below 55?

We have Yesterday Value Area High= 1552.50 and POC= 1550.5

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Today's high barely overlap the low of 10/11/07 at 1556.5. If last Thursday's selloff was wave 1, today's high could still qualify as a wave 4 high.

One of the definition of an impulse wave is that wave 4 correction cannot exceed extreme of wave1. Also since wave 2 was a simple ABC correction, we have potential of developing a complex wave 4. Sp with major international news in the background, we need to monitor this carefully

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well messy for my limited experience i should say. this is also that chop area from 2 weeks back, just seems like a pretty uncertain area right here.

Cross currents

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well messy for my limited experience i should say. this is also that chop area from 2 weeks back, just seems like a pretty uncertain area right here.

Darth:

Your observations are good. I am many times too close to the action to see the forest from the trees. Other people like James and Dogpile do a lot of Pre-market Analysis. I am just experimenting and try to see if posting my analysis will help me trade ?

To tell tell you the truth, I still think the analysis is not that important for a Daytrader. I am still a firm believer in "Trade What You See and not What You Think"

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<<I am still a firm believer in "Trade What You See and not What You Think">>

 

 

I think that the short-term 'set-up expertise' is 70-80% of the game. But just keeping in mind the high-volume pivots and watching the action there has really helped me. This is especially true in the morning, which tends to be a counter-trend environment anyway. I did a short scalp and a long scalp this morning and both worked. My oscillators lined up at exactly the point price entered the pivots I had identified. I feel comfortable using a wide initial stop at that point and scalp out partial positions in the noise and play the real pattern with the balance. I can also always 'scalp-out' if my oscillators do something I really don't like and take a small loss.

 

Also, watching the action around the pivots gives you valuable information. For example, you had a tight coil at 1548.00 yesterday and it pressed up to the 58+ zone overnight. A good upward coil break should not return to 1548.00. When it corrected down to 51.00 today -- it should have launched up. But it petered-out. This was the warning sign. Once it returned to 1548.00 -- that is a 'bull trap'. Now you go auction the other way. I didn't play that breakdeown because I thought 48.00 might get noisy --- but I certainly didn't go long into 48.00 just because it was a high-volume zone.

 

I don't know, it works for me. To each his own.

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