Ok.. so here is the summary now. Didn't take any more trades, partly because of the server problem earlier, partly because we were in a range the whole time (although I am looking to trade ranges), and partly to also protect my little bit of profit. (yes, this last reason is the worst).
A - So I think I'm going to be a bit patient and wait for the first 5 mins to see how the opening range shapes up. Although my blue lines and dashed blue line show the range of the entire overnight session, the few hours leading up to the open has price in a tighter range.
Here we hit a high at 98, observation being that we failed to even make it to the overnight high.
B - Here we hit a low, bounce off the overnight low. I so want to trade these reversals. Stops would be really tight, one point tight, so risk is well defined, and I think as long as I take each one, the profits will more than outweigh the losses. This might mean that I am scalping, but all I am really looking to do is to get into the move as soon as possible, so a scalp would result if price comes back to my entry, but as long as there are reasons to stay in the trade, I would hope to ride the trend.
The rules say to wait for a RET, (I would wait to see this in a tick chart), and to not trade in a range. But my inclination is that once fear goes away, getting into a move sooner can be profitable and leads to less stress down the road, at the other end of the extreme. Anyway... will really have to test this. This REV is much better here at B mind you because it is a level of some significance, not at A which is still short of the outlined levels in prep. (I am trying to keep in mind though that overnight levels are reached with much lower volume, so the levels established by the opening range might perhaps be more important)
C - This lower high forms, but of course by the time you are sure, price is almost at the other end. Observation being though that we failed to even make it to the previous high, so now I for sure am hunting that short.
We can also now start to draw in our hinge, which is even more confirmed a bar or two after C. And since we can draw in a hinge, I also draw in the apex of this hinge with the blue dotted line.
D -I take a short here. Truth be told, its not the best place given the REV at B, but since its a hinge and price dropped out, and since we had two chances to go higher but didn't (at A and C), trying for a short has a reasonable chance. (Although in trading, the best chance is probably better than a reasonable chance. I have to keep telling myself though that what looks like support or resistance might not be so when price gets there again) (This is a perfect example of how I am so indecisive, I can talk myself in and out of every trade... I'm so politically correct looking at both sides!
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E - This is where I am trying to exit my trade now. I held on while price came back up to test the levels at D again, but noticing this second hinge forming, I think its best to get out for a couple of points profit just in case the hinge breaks to the up side. This is where I ran into trouble with my exit order, and was forced to hang in there. I also have the apex drawn in here for this hinge as well.
F - We go even lower, and I think, ok, great, my trade is worth more money, but its really time to get out now... nothing I can do about it. Price comes back up to test the apex, and we drop again.
I should point out that this level isn't a huge surprise. I didn't outline it in my prep, but I was fully aware that this level was roughly the mean of all the action yesterday (88-89), so turning around at 87 wasn't unexpected.
G - I call this a double bottom, although its one tick higher. I notice after I reload my charts, things move a tick or two actually, which is not too comforting, and I have seen this too in that some trades get filled even though price doesn't appear to even have hit that level. Anyway, not much I can do about this, just like not much I can do about an overloaded server.
As it turns out, my short is finally exited somewhere around here at 89 which is very close to the bottom indeed. Thankfully that worked out this time.
H - We have a quick rally up to H, busting through the apex of the previous hinge at roughly 91. We don't quite make it to the apex of the first hinge at the open, but you can say we form yet another hinge. Days like this are a bit messy, multiple hinges, and trading ranges, but somehow we also have a move that does go somewhere which is unfortunately well disguised. At the end of the day you can see it goes up, but not so easy in real time.
This is perhaps the main reason why I want to trade ranges. Eventually price does leave and then you are in the move from the beginning. If one doesn't know how to trade ranges mind you and keeps losing 2 points each time then this might not be too good, but if you follow the action after this point at H, the range is quite lovely, and although barely 6 points wide, I do believe money can be made.
I - The exit out of this hinge leads to nowhere, which does happen in that it just leads to a range. You could even call this a FO where price leaves initially out the top, but then the move out the bottom is stronger.
J - We hit a low here, noticing its higher than the lows at F and G. One point above this bar would be a good entry for a long.
From here on in, we are clearly in a range, but enough about that. Lets notice though that each low is just a tick higher, whereas the tops of the range are pretty much in line, if not a tick higher in comparison.
K - Here I think, ok, lets follow what taking a short here would do, place one stop below the range to get in short, and a stop at one point above the range. We would fill, but of course it goes nowhere and would have to be exited at a loss of 2 points.
Its important to keep in mind though that ranges will eventually break. So if I am going to trade ranges, I have to trade each extreme from the outset, knowing that I will lose on the last trade, but if its a range, it should be give me a few opportunities on the way up and down. If I managed to get 4 points in each wave lets say, just taking them mechanically at what I think will be the top and bottom, call it 94 and 88, so taking trades at 89 and 93, I do believe that I could have captured 4+4+4+4=16 points, and lost 2 on this last exit. Just thinking out loud here of course since I clearly didn't trade it this way.
L - Another short op comes up here, although the RET is in the 15 second chart so this would be entering very soon. Nevertheless, if waiting for the better entry after the RET, this would happen 5 minutes later and get filled as well.
The level of 94.50 that initially provided R is now S, but the short does break through this S here.
M - Our short wouldn't go far, and although we are back into the previous range, we just cannot go below 93.
Looking at this as a whole, we have lows at F and G, then a higher low at J, and each low is slightly higher. The big picture here is that we are going up.
N - As we continue up, we hesitate a bit at the opening high here, but its only a 2 point RET before we continue even higher.
Then we break the overnight high, and even yesterday's high. Its still not worth more than 15 points mind you, but I am not that greedy, even 10 points is plenty once I get comfortable trading even just 3 contracts.
SUMMARY - Up +$76
