Yesterday during the US session, US index futures
(and Asian index futures, European index futures, bonds .....) went up significantly.
So what would happen to today's Asian session?
continue to go up - 10% probability
don't move - 60% probability
reverse direction - 30% probability
For today's Asian session, I have yet to enter a single trade.
This may be long, but please as a favor hear me out on this. If none of these points, concepts or information resonate's with you at all, than in the future I will never ask you read another message of mine. Thank you.
****The only data point you presented was that the markets went up significantly. Understand you're not shorting it, but this is very close to the same logic and reasoning why other people are shorting this, keep shorting this and why it will continue to most likely go higher. So, yes I am taking advantage of this pattern until it clearly ends. There's some people on here who say they don't buy the highs, well if you've been shorting lately you've been buying the highs. So there's something telling you not to short this personally, I am just adding in additional confluences and explaining why not only is it not a good probability short, it's actually a good probability long still.
**** The markets are not really 0 to 100 flat, it's more like a cylinder where if you go up or down enough, it resets essentially back to 0 particularly for intra-day trading. For a basic example that most traders regardless of style or level could understand :
Let's say two EMA's are positioned a certain way and we get overbought on the 5 minute. That could be a sign that a pull back is much higher probability than further extension. However, if those same two EMA's are positioned differently and we get overbought, that relation is completely different. Now the probability is much higher that we move up prior to a pull back. So just thinking a chart went from 0 to 100 so let's short, it definitely can an advantage, but not near the edge of understanding when that relationship is irrelevant. What if you get stuck in a market environment that produces 40% of your over all losses shorting the 100 range, but that market environment was only a fraction of your back testing? That's why and how bots or even manual traders that do well, all the sudden lose a lot, because lack of context and overall market understanding. It's why context and experience is always king. They just happen to be using an entry vehicle that is in line with current market environment, but it has nothing to do with actual skill or long term succes.
Another point that I did already say but is important is that larger charts like monthly and weekly and extremely active. Therefore the expectation is on smaller time frames even the daily we're expecting larger outside moves than normal. So the less probability thing would be for us not to do that.
Personally for me Asia went up quite nicely as expected. Almost a 100 point up move on NQ to me is sizable for overnight. Yes, I am well aware the market moving in your direction could just be luck or randomness. But I very logically and clearly laid out multiple reasons as to why this would be the expectation and it did end up happening. Also mentioned a day before last night's comments, of the overall pattern we were in and a lot of trapped sellers still. So that's the best I can do is give logical, sounds and mathematical reasoning and than it plays out as expected. So, if you want to chalk it up to luck, that's fine impossible for me unequivocally defend that.
What are your thoughts on all of this?
Thanks for taking the time to read.
