you're correct, I ID'd the 3rd time that price reached that level (there were 2 tests) today
heh... I agree...but... you did say one should understand trader psychology at some point didn't you...?
If You Can Draw A Straight Line . . .
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you're correct, I ID'd the 3rd time that price reached that level (there were 2 tests) today
heh... I agree...but... you did say one should understand trader psychology at some point didn't you...?
Q's are weakening and S&P and other indexes are already not the strongest. What of GOOG? It appears to be weak to me. It's bounce was feeble. Although 860 did give a that feeble bounce I am not so confident about it holding if market continues to weaken. We'll find out soon enough I guess.
GOOG Daily:
Gringo
GOOG Daily:
Gringo
The "psychology" pertinent to the trade is the failure to make a new high. This failure occurs immediately. Anyone not picking up on it or waiting for an indicator has a second chance at the second failure, at 1666.5. Even there one has yet another opportunity at the third failure, at 1664.25, though by now even the dullards begin to understand and the result is a cascade, which is great if you're in, not so great if you aren't because you're unlikely to get filled. You have no idea where traders' stops are or what others' plans may be. So don't think about it. Everything you need to know is in the behavior of price.
So, the correct entry? Four hours earlier.
Quote from Gringo:
Q's are weakening and S&P and other indexes are already not the strongest. What of GOOG? It appears to be weak to me. It's bounce was feeble. Although 860 did give a that feeble bounce I am not so confident about it holding if market continues to weaken. We'll find out soon enough I guess.
GOOG Daily:
Gringo
G, from here it looks like is still within the context of the TR, I agree that last upswing was lame, and found R at the PDL (Bearish) but we all know buyers can be waiting at the bottom of the TR just to screw things up, I would wait for a BO and its respective RET before jumping into the bear wagon.
Niko,
I have removed the blue box now to give your mind a different perspective. Notice now the break down from the hinge and a retracement back up is now coming to an end. Combine this with NQ weakness or at least a possibility of it. Apart from NQ, S&P which is not even close to its swing high is just by virtue of not at the top is indicating weakness. Although I wouldn't advise most to attempt it the way I do but there are times when a head start can be beneficial. Once one is aware of the dangers then other possibilities open up.
Notice the increasing downward wave lengths and shortening upward wave lengths. There has been a shift in demand and supply dynamic in favour of supply. When demand is losing why not stay alert to the possibility of supply taking charge even more. Price follows the path of least resistance. I have indicated on the chart possible exit points which are quite close at hand hence making risk manageable. This chart is a good test case to hone one's skill to read price. I am sure you'll be eagerly watching GOOG just like I shall be. The key here is the risk tolerance of the trader. There are some who'll wait for the break of support and others who'll wait for a retracement. Then there are those who cause the price to break the support. I am with them
.Nothing is certain, but we have the choice to exit when price doesn't go according to our expectation.
Gringo
Whether price "conveyed" the follow through is not the point, nor were the actions of the YM or ES. Price failed to make a higher high on a second attempt to do so, at resistance. Therefore, a short was called for. VWAP and events are not pertinent, at least not to the focus of this thread.
I did not trade this, and so this should be taken as hindsight.
However, I did have my lap top with me and I saw the NQ was making that high. If you recall, the high of this rally a few weeks ago was 3148, and today price advanced back to 147.25 during what for you was the 12:11 CST bar, and on my platform (multicharts fed by IB) was the 13:12 bar interval. I was watching, and I will tell you where I wanted to place a short using an NDX based ETF, e.g. QQQ, QID, TECS because I thought that would be a cheap place to get short if price were going to reverse here at resistance for a few days, maybe even test the recent lows.
I did not do anything, however, because I just do not have a clue as to which or what would be best. I do not know how these ETF's work. I mean, I kind of know, but not really, and while I consider myself a risk taker, I do not like taking blind risks. And I did not want to expxose myself, yet, to the leverage of being short the futures overnight. I do not understand options, so that was out. So I can say where I would have taken a short had I been ready to do so, both as a day trade or as an EOD trade (even though for the EOD trader, the best opportunity to put on the short was in the middle of the day).
So, let me get to this: The high on my chart occurred duing the 13:11 Easter Time bar interval, which for you was 12:11 Central time bar interval. I would have shorted what for me is the 13:18 bar interval, which for you would have been the 12:19 bar interval.
Here is the one minute chart (left hand side) showing were I would have shorted, whether NQ day trading or looking for an opportune cheap risk short for a longer hold. You can see the magenta R at 3148 just above that high.
On the right is the 1 tic chart. Recall the first post of this thread and the role the midpoint of a buying or selling wave has in determining the immediate trend of prices. Though the initial selling wave at R was small, a mere 2 points, the retrace of that wave was only 1 point, or 50% of the selling wave. The failure to make a new high at that point was the tell. Watching on the 1 tic chart can really let you see what is going on, who is in control (see the magenta arrows), and which side you should want to play for.
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