Find a security that is trading in a strong 5 min trend and check that the daily and weekly bias is the same. Your making this much more complicated than you need to. Mr phoenix will come on and say something shitty like he always does but you need a strong trend to make money not just a load of patterns on a 1 min chart
CLA - Price Action Journal (SLA)
- Thread starter lajax
- Start date
Ability to read price is independent of bar intervals. If we remove any indications of what bar interval it is, is a person able to tell whether it was 5, 10, 15, 25, 30, hourly, daily, weekly?
When the time to decide an entry or exit comes then of course one will need to focus on important areas such and overnight high/low, opening high/low, trading ranges and trend channels to align the ducks.
Gringo
When the time to decide an entry or exit comes then of course one will need to focus on important areas such and overnight high/low, opening high/low, trading ranges and trend channels to align the ducks.
Gringo
yes I suppose your right, maybe I take the fact that I have been watching price action for years and it's second nature to me so I quickly scan the different time frames and put in my own trend lines
I’m going to start the analysis of the PA from the previous day in order to identify the behavior of it during the Overnight period (15m)
1. During Feb 17th the price was into a range of almost 40 ticks, which means that the buyers and sellers were in equilibrium, however in Feb 18th, around the 5:45 am the price started making HL´s (Point A) and HH´s (Point B), creating an uptrend, However all the PA was still on the range and the break of Resistance was necessary to confirm that the buyers were in charge.
2. After the BO, the price retrace and the buyers are able to hold this level (Point C) and make a HH, confirming the uptrend.
3. In the opening the buyers are able to make a HH, however this movement is reverse by the sellers who took the price below the previous Low (Blue Dash Line), notwithstanding the price is immediately reverse by the buyers who took the price to a new HH, situation that gives sings of strength in the uptrend
4. The buyers try to make a New High (Blue dot E), but it doesn’t have enough strength and the sellers take the price below the previous Low (Black Dash Line)
5. Notwithstanding, once again the buyers take control and make a HH that is accompanied by an acceleration of the movement and a high volume (Green arrow)
6. After that the buyers makes a new HH (Point F); then comes a new upward impulse but the sellers are strong enough to hold that level (Point G) and make a LL and a LH
7. After that the trading activity decrease and the PA become a little bit listless.
The levels of the premarket are establish, If you have any comment about them please let me know
Tha day Observations
1. During Feb 17th the price was into a range of almost 40 ticks, which means that the buyers and sellers were in equilibrium, however in Feb 18th, around the 5:45 am the price started making HL´s (Point A) and HH´s (Point B), creating an uptrend, However all the PA was still on the range and the break of Resistance was necessary to confirm that the buyers were in charge.
2. After the BO, the price retrace and the buyers are able to hold this level (Point C) and make a HH, confirming the uptrend.
3. In the opening the buyers are able to make a HH, however this movement is reverse by the sellers who took the price below the previous Low (Blue Dash Line), notwithstanding the price is immediately reverse by the buyers who took the price to a new HH, situation that gives sings of strength in the uptrend
4. The buyers try to make a New High (Blue dot E), but it doesn’t have enough strength and the sellers take the price below the previous Low (Black Dash Line)
5. Notwithstanding, once again the buyers take control and make a HH that is accompanied by an acceleration of the movement and a high volume (Green arrow)
6. After that the buyers makes a new HH (Point F); then comes a new upward impulse but the sellers are strong enough to hold that level (Point G) and make a LL and a LH
7. After that the trading activity decrease and the PA become a little bit listless.
The levels of the premarket are establish, If you have any comment about them please let me know
Tha day Observations
Attachments
Regarding the 17th and 18th, very nice. As few lines as possible, at this stage. However, regarding your 3 and 4, it doesn't matter so much that the previous low was broken but that price charged back up so strongly, in both cases. The fact that it did so says much more about buying strength than the drops below those lows say about weakness. This behavior increases the probability that price will continue to rise.
Having done this, perhaps you now see the importance of traders not being able to take price past 102.85. The fact that price plunges so quickly and so dramatically off that failure confirms the importance of it.
As to the 19th, don't become so distracted by 1m hinges that you lose sight of the context, particularly that traders find "support" at the bottom of the range that they spent all the previous evening and that morning creating. As to your 9, it isn't so much that sellers are showing their strength as that buyers are showing their unwillingness to take price higher. Without willing buyers, sellers have no choice but to lower their prices.
Having done this, perhaps you now see the importance of traders not being able to take price past 102.85. The fact that price plunges so quickly and so dramatically off that failure confirms the importance of it.
As to the 19th, don't become so distracted by 1m hinges that you lose sight of the context, particularly that traders find "support" at the bottom of the range that they spent all the previous evening and that morning creating. As to your 9, it isn't so much that sellers are showing their strength as that buyers are showing their unwillingness to take price higher. Without willing buyers, sellers have no choice but to lower their prices.
Db thanks for your feedback. I'll try to introduce this way of thinking in my observation process
February 20th
Premarket Observations
1) During the session of Feb 19th, (from the opening 9 am until the 14 pm) the buyers and sellers were looking for value on a state of equilibrium (Hinge – green dots)
2) After that came the BO of the hinge to the upside, where buyers are accompanied with a great volume (Green arrow) and an acceleration of the movement. However they are unable to make a new HH, showing their unwillingness to keep moving the price up, moreover, is important to mention that the zone of the 103,14 is the UL of the long Term channel.
3) After the rejection of the UL (long term channel) the sellers take the price down and make a LH and a LL (first retracement confirmed – Point A), but the buyers try to hold the price until the previous high (Point B), however the sellers make a new LL, where the downward stride is bigger than the previous one (the distance from B to C is bigger than the distance from A to B).
4) The price keep falling until the middle of the Hinge, here the sellers are unable to keep making LL; notwithstanding the buyers came in and make a HL (point D) and a HH (point E), therefore exist an uptrend, however the behavior of it is not “clean”, because when makes a HH (point F); there is no a substantial advance, moreover the retracements are deep
5) The price ends up in a hinge once again, close to the middle of the previous one, looking for value.
6) Then the sellers take the price out of the hinge and make a LL and a LH (Point G), but the buyers take control once again and immediately up the price until the middle of the hinge.
Daily Observations
Today was a day that show the interaction of the market (Buyers and Sellers) with the Middle of the previous Hinges and zones of interest, particularly was a volatile day with strong movements at the end maybe because the Crude oil inventories (11 am).
Actually, it's not; it's the mean/median of the long-term channel. See the chart I posted to my journal.
You appear to be picking up on the fact that there are a great many hinges and a great deal of ranging in oil, all of which reflect much time spent searching for, finding, and settling into equilibrium. At some point, you're going to want to think about what this means in terms of whether or not this is the appropriate instrument for you.
Yes, you are right; I took a chart from a lower time frame, so it really was not the long term channel
Regarding to your observation and a previous comment of Gringo, I will move forward with the study of the NQ, because as you said the CL spend great part of the time searching for value creating a lot “zig zaggy motion” (as Gringo Said)
So for this reason I´ll move my observations to the next thread in order to advance in my learning phase
Price Action – NQ: http://www.elitetrader.com/et/index.php?threads/price-action-nq.289300/
I thought you might. This is the sort of thing that happens when one stops long enough to characterize his market. And it saves tons of money, not to mention time.
You noted that there are an extraordinary number of hinges in any given day. Since a "hinge" is formed when traders are seeking equilibrium, then the obvious conclusion is that oil traders spend nearly all their time seeking equilibrium. If you want to scalp, then that may be just the ticket. But in that case, the SLA will be pretty useless. If you don't want to scalp, if you'd rather trade trend, then focusing on something that spends most of the day ranging isn't going to provide the profit opportunities you want.
And now you don't have to bother with trying to trade it, which is often the result of the observation phase.
You noted that there are an extraordinary number of hinges in any given day. Since a "hinge" is formed when traders are seeking equilibrium, then the obvious conclusion is that oil traders spend nearly all their time seeking equilibrium. If you want to scalp, then that may be just the ticket. But in that case, the SLA will be pretty useless. If you don't want to scalp, if you'd rather trade trend, then focusing on something that spends most of the day ranging isn't going to provide the profit opportunities you want.
And now you don't have to bother with trying to trade it, which is often the result of the observation phase.