Son of If You Can Draw a Straight Line . . .
- Thread starter dbphoenix
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This is the updated chart of SLV. It includes the explanations that were given a few posts earlier, to make it easier for those who may not have understood the point I was trying to make. It is clear that at times I am not clear enough. The possibilities of price going up, down or sideways take a bit of time to write it all out, and I may be guilty of short cutting my writing when explaining myself. Usually I attempt to use charts to write as much as possible for the reasoning behind my thoughts. Despite my good looks even I don't know most of the time which way the price is heading. All I have are pieces of a puzzle, scattered around by the interplay of supply and demand, left on the charts in the form of price flow. Some times I get it right, and some times I get it wrong. There are also times when I don't have a clue as to what the clue means. I strive to get better and keep writing and analyzing in the hopes that the process brings clarity to my own way of thinking. I do it as much to help myself as to help others. Db had put me on this path of writing it all out and letting it float in the cyberspace. It was to make me accountable to myself. Without written information our mind has a queer habit of fooling ourselves into believing the outcome was what we had anticipated it to be.
Here's the SLV Daily chart with some comments to explain the reasoning behind the assertion that the probability of price going sideways or up is a bit higher than the probability of price going down. Now these are not hard calculable probabilities, but rather the relative strengths of one event being more likely than the other. That's all we need to make a decision, strangely enough, and not gobs of data. Did I mention somewhere I am prone to making errors as well?
Gringo
Here's the SLV Daily chart with some comments to explain the reasoning behind the assertion that the probability of price going sideways or up is a bit higher than the probability of price going down. Now these are not hard calculable probabilities, but rather the relative strengths of one event being more likely than the other. That's all we need to make a decision, strangely enough, and not gobs of data. Did I mention somewhere I am prone to making errors as well?
Gringo
Gringo,
Thank you for the welcome, and for taking the time to develop your thoughts further. I can understand now the reasoning behind your assertions with greater clarity.
I would like to refine the balance by which I emphasize the information that I am receiving from various time frames as I work to bring them all into coherency in my attempt to understand all of the factors and pressures affecting the current price behavior. It's all one continuous motion, after all.
I agree that it will be beneficial to see how this situation plays out, especially with the analysis that we are taking the time to perform. It is probable that I had under-emphasized this morning's swift return into the week's range in my initial overview, especially because it took some pressure to get it out of the range initially, and as you've said, demand quickly overwhelmed the decline in price even though the weekly downward trend-line is looming nearby.
I have benefited from your elaboration on weighing the relative strength of the information we have. As I think of it further, it was premature to weigh the Yearly Supply Line so heavily in my first overview. Although it might have a slight top-level effect on price behavior, it likely will not start to exert any significant pressure on price until around 24-25, which gives us plenty of room to work with for taking a decent profit.
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I intend to trade some small size during the NQ open tomorrow since that seems to be a popular context for practicing, developing and demonstrating these Price Action concepts in this discussion. Best wishes to those who are going to trade it tomorrow as well. I am looking forward to hearing about your thought processes.
Thank you for the welcome, and for taking the time to develop your thoughts further. I can understand now the reasoning behind your assertions with greater clarity.
I would like to refine the balance by which I emphasize the information that I am receiving from various time frames as I work to bring them all into coherency in my attempt to understand all of the factors and pressures affecting the current price behavior. It's all one continuous motion, after all.
I agree that it will be beneficial to see how this situation plays out, especially with the analysis that we are taking the time to perform. It is probable that I had under-emphasized this morning's swift return into the week's range in my initial overview, especially because it took some pressure to get it out of the range initially, and as you've said, demand quickly overwhelmed the decline in price even though the weekly downward trend-line is looming nearby.
I have benefited from your elaboration on weighing the relative strength of the information we have. As I think of it further, it was premature to weigh the Yearly Supply Line so heavily in my first overview. Although it might have a slight top-level effect on price behavior, it likely will not start to exert any significant pressure on price until around 24-25, which gives us plenty of room to work with for taking a decent profit.
---
I intend to trade some small size during the NQ open tomorrow since that seems to be a popular context for practicing, developing and demonstrating these Price Action concepts in this discussion. Best wishes to those who are going to trade it tomorrow as well. I am looking forward to hearing about your thought processes.
Well, I let price do everything short of plunging to new lows. I've held this trade since the wee hours of Tuesday morning. The bottom line is that the back testing I had done which led me to take this long has, in almost all cases, led to a quick rise from the entry point. I exited a few minutes ago, taking one tick to the good to cover my costs. I am now out of the ES and will wait and watch and see what happens to indicate I should be back in. Right now, everything I know of the market (which is admittedly very little) is telling me to "Get Out!" So out I go. Doesn't mean price doesn't rally from here, and it is not a "prediction" of lower prices to come - just that what I was anticipating to happen has not happened, and I've given price about three times the length of trading hours as I would have expected my answer.
In the category of wouldacouldashoulda, I really should have considered holding my long NQ at 3186.25 for the retest of the highs at 3241.50 - by the end of that day, that really looked like the high probability trade.
Still learning here
Three views of the NQ taken over the last few hours - a sort of "time lapse" exercise. The missing 4th has yet to be taken - that will be after the close.
Don't know if I done this 'correctly' or not, but here was my attempt today at my interpretation of the concepts in this thread.
Good work here. At least you are able to tell up from down and that's the hardest thing to figure out. You've been exiting at swing lows but that's a personal choice. The fact that you changed your direction the moment price indicated it wasn't doing what you had expected it to do and then reversed it is 'very' impressive.
With a bit more observation and perhaps some use of the supply/demand lines you might be able to squeeze a bit more juice out of the moves. But all that comes later. What's important is that you are seeing the flow which in itself is an achievement. It's strange within a day or two we have new price action traders arrive who are not too green to being with. I love it!
Perhaps it's an indication that properly reading the threads and observing the price, it's not impossible to achieve this seemingly insurmountable feat of being able to read price, without indicators and moving averages, and make appropriate decisions.
Gringo
Today seemed like a template of a few major trend days we've hand in NQ in the past few weeks. Even if one doesn't know much about price just memorizing that behaviour should have been enough to get at least 20 points on NQ. Those who were faster probably could squeeze 30 or so points just by following supply/demand lines or swing high and lows. Days like these make me wonder whether I should also start trading intra-day as it is quick, efficient, and then one can exit and enjoy the day. Then again I have seen those messy range bound days as well and my common sense returns.
Gringo
Gringo
Q's are showing first signs of weakness. This surely is early and the opportunity like this is for the bold and the quick. Risk is quite easily managed here and contained. Some would want to see the swing low around 78 to be violated first and then perhaps short when price retraces back up. Others may prefer to jump in now and hope that this drop isn't short lived. We don't know the extent of the future move so all we can do is make a decision based on what we see in price now.
What may be interesting is the changing nature of the market. If it is an early stage of or an onset of the bear, and keep in mind the Oct 2008 debacle was half a decade ago, we might be looking at the spread of weakness across the board. Again, this is an early stage and subsequent strength in price with demand showing up and doing the hard work can easily change this somewhat negative outlook to neutral or positive. But for now because the price failed to continue up, the other options for it are sideways or down. Notice with my previous SLV analysis the same logic was used when price popped back into the trading range after dropping from it. It's the same logic, and the same thinking used again and again. Once a person spends some with this kind of analysis it stops being a mystery, and becomes quite boring, because of the repetitive nature of the price behaviour and the resulting analysis.
It must be realized that being the early bird to claim or identify something isn't as easy as it seems. A lot of you soldiers and budding soldiers out there read this but it is the one putting the analysis out who's setting himself up for judgement and ridicule. At times I don't want to write things until more certainty is achieved, but then I think of how much those who are learning (including myself) would miss if they weren't able to see the interplay of these conflicting thoughts and uncertainties. We can never ever be certain and that we must find a way to make decisions while the picture isn't all clear. The fog of war as some would call it.
While I am writing this tome and my emotional mumbo jumbo, price is heading down more and more and I appear to be posting it later and later.
QQQ Daily:
Gringo
What may be interesting is the changing nature of the market. If it is an early stage of or an onset of the bear, and keep in mind the Oct 2008 debacle was half a decade ago, we might be looking at the spread of weakness across the board. Again, this is an early stage and subsequent strength in price with demand showing up and doing the hard work can easily change this somewhat negative outlook to neutral or positive. But for now because the price failed to continue up, the other options for it are sideways or down. Notice with my previous SLV analysis the same logic was used when price popped back into the trading range after dropping from it. It's the same logic, and the same thinking used again and again. Once a person spends some with this kind of analysis it stops being a mystery, and becomes quite boring, because of the repetitive nature of the price behaviour and the resulting analysis.
It must be realized that being the early bird to claim or identify something isn't as easy as it seems. A lot of you soldiers and budding soldiers out there read this but it is the one putting the analysis out who's setting himself up for judgement and ridicule. At times I don't want to write things until more certainty is achieved, but then I think of how much those who are learning (including myself) would miss if they weren't able to see the interplay of these conflicting thoughts and uncertainties. We can never ever be certain and that we must find a way to make decisions while the picture isn't all clear. The fog of war as some would call it.
While I am writing this tome and my emotional mumbo jumbo, price is heading down more and more and I appear to be posting it later and later.
QQQ Daily:
Gringo
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