How to interrpret this 15 Min ES Candle
- Thread starter wiesman02
- Start date
Nice chart with reliable action. This isnât a Bar Chart so we are not reading it as an outside bar, itâs Candle Chart giving a pile of signalsâ¦
1. Itâs a Spinning Top type formation telling us traders are not sure what to do
2. But look inside at the bodies â very little overlap on this pullback = decent quality/reliability signal to follow
3. The lowest close of a formation is often best support and we reverse bang on it
4. Thereâs double support here with a pullback to the open â a favourite level for intraday traders
5. This holding period is just a little longer than the last one so be alert to a move
6. The 20MA has a history of pulling in the buyers and does so again with hold-time approx equal to last (as point 5.)
7. The 20MA is in a steep bullish phase and pulling away from the slower MA so expect upward energy
8. This was profit-taking selling: the volume was in the Doji type top and thereâs no follow-through volume
9. You should have caught this reversal in a lower timeframe
10. If you are slow or miss the clues, the break of the high on big volume will get you in.
Lots of clues on a chart that exhibits good structures, reliable pullbacks/pauses and volume signals. As the smart money was not in the selling Iâd expect youâd get most of the volume early in the move up in the smaller timeframe and Iâd expect to see the chart to give a high quality signal in the 5 min chart.
In a nutshell, the spinning top tells that most traders are sucking their thumbs while the smart ones have the play in their pockets.
1. Itâs a Spinning Top type formation telling us traders are not sure what to do
2. But look inside at the bodies â very little overlap on this pullback = decent quality/reliability signal to follow
3. The lowest close of a formation is often best support and we reverse bang on it
4. Thereâs double support here with a pullback to the open â a favourite level for intraday traders
5. This holding period is just a little longer than the last one so be alert to a move
6. The 20MA has a history of pulling in the buyers and does so again with hold-time approx equal to last (as point 5.)
7. The 20MA is in a steep bullish phase and pulling away from the slower MA so expect upward energy
8. This was profit-taking selling: the volume was in the Doji type top and thereâs no follow-through volume
9. You should have caught this reversal in a lower timeframe
10. If you are slow or miss the clues, the break of the high on big volume will get you in.
Lots of clues on a chart that exhibits good structures, reliable pullbacks/pauses and volume signals. As the smart money was not in the selling Iâd expect youâd get most of the volume early in the move up in the smaller timeframe and Iâd expect to see the chart to give a high quality signal in the 5 min chart.
In a nutshell, the spinning top tells that most traders are sucking their thumbs while the smart ones have the play in their pockets.
Would've tried to buy the pullback for a retest of the highs.
-Prof.
-Prof.
From a scalper, or otherwise short-term intraday point-of-view...
The bar in question is nothing special. As has been pointed out, it is a spinning top. IMO, single bar patterns are not meaningful, and certainly not a spinning top.
The preceeding 12 bars or so form a bear flag, with multiple ledges. It is those ledges, coupled with the bear flag support/trend line that should be maintaining the traders upside bias. In otherwords, a departure of the longside is CLEARLY defined, although it did not occur.
That said, back to the bar in question...
There are several, entry points on the longside...
1) The first being just above the open of the bar. Back on the discussion of ledges... notice the bar open is the same as the close of the preceeding bar, which is the the same close of yet the previous bar. That's now a 3 bar pattern, btw.
2)The next entry would be just above the high of the bar. Notice the high of bar 4 bars preceeding. When this happened, it also provided a fresh high of the previous 4 bars. I'll let you do your own research to determine whether or not that is something useful for you.
Depending on your risk tolerance, the MAXIMUM risk would have been a break of the low, looks like 88.25 or so. So depending on which entry you made, MAXIMUM risk of (approximately) 2 to 4.5 handles. More "conservative" risk, would be a break of the bearflag support/rtrendline, which coincides (roughly) with your MA line. An argument can be be made for a break of the bar in question low as well, since it is yet another ledge with the 4 bars preceeding. Personally, I don't like the spread between that ledge and the low around 88.25. It's too small... That suggests, the ledge is less meaningful, IMO.
Anyway, hope you had a profitable trading day.
Osorico
The bar in question is nothing special. As has been pointed out, it is a spinning top. IMO, single bar patterns are not meaningful, and certainly not a spinning top.
The preceeding 12 bars or so form a bear flag, with multiple ledges. It is those ledges, coupled with the bear flag support/trend line that should be maintaining the traders upside bias. In otherwords, a departure of the longside is CLEARLY defined, although it did not occur.
That said, back to the bar in question...
There are several, entry points on the longside...
1) The first being just above the open of the bar. Back on the discussion of ledges... notice the bar open is the same as the close of the preceeding bar, which is the the same close of yet the previous bar. That's now a 3 bar pattern, btw.
2)The next entry would be just above the high of the bar. Notice the high of bar 4 bars preceeding. When this happened, it also provided a fresh high of the previous 4 bars. I'll let you do your own research to determine whether or not that is something useful for you.
Depending on your risk tolerance, the MAXIMUM risk would have been a break of the low, looks like 88.25 or so. So depending on which entry you made, MAXIMUM risk of (approximately) 2 to 4.5 handles. More "conservative" risk, would be a break of the bearflag support/rtrendline, which coincides (roughly) with your MA line. An argument can be be made for a break of the bar in question low as well, since it is yet another ledge with the 4 bars preceeding. Personally, I don't like the spread between that ledge and the low around 88.25. It's too small... That suggests, the ledge is less meaningful, IMO.
Anyway, hope you had a profitable trading day.
Osorico
Like the simple wooden chalis this post is the holy grail, not at all what you thought you were looking for, very eloquent yoohoo. Anyone who is looking start here.