Wyckoff's Monster

For those following the Ghost thread, DBP and I have been discussing how to characterize a market (clumsily on my part). I've since had a nap and read the latest pdf and realized something (I hope) that wasn't clear to me.

I think a poker analogy might be the clearest here...

A poker expert who is a pretty friendly guy has made friends with an excited beginner at his local card room. The expert sits at the "big" table doing his thing when one day the beginner runs up and says, "can I ask you a question about a hand I just played"?

The expert agrees and the beginner starts, "I was dealt AJs (the "s" means suited), a player raised before me, what should I do"?

The expert replies, "Where was the initial raiser sitting?"

The beginner says, "Under the gun maybe?" (UTG means first player after the blinds)

The expert asks, "where were you sitting?"

The beginner says, "I was one off the button."

E - "How much did he raise it"?

B - "Uh, 3x the blinds, maybe 4x?"

E - "How much money did he have behind"?

B - "Uhhhhh, maybe 30 blinds? Maybe 50?"

E - "How much did you have in front of you?"

B - "I don't know but can you just answer the question?" and storms off (for the brevity of this post but this could go on for a while).

In case all the poker lingo is over your head the point here is the beginner knows the lingo. He knows that AJ suited is a difficult hand to play after a raise and he wants an answer like - "you should re-raise" or "you should fold". The expert understands that there is a lot more too it and the devil is in the details. He can't give a clear answer (to the beginner) but he can point out that the beginner isn't paying attention to the things that make this decision a snap.

If the point here is lost on my fellow SLAyers re-read Appendix E and honestly answer how much characterizing you do before you sit down before the opening bell.
 
That's good stuff. I posted sort of a template in my thread on what I plan on following in order to try to do what you describe if you want to take a look at it and critique it.
 
green.green said:
For those following the Ghost thread, DBP and I have been discussing how to characterize a market (clumsily on my part). I've since had a nap and read the latest pdf and realized something (I hope) that wasn't clear to me.

I think a poker analogy might be the clearest here...

A poker expert who is a pretty friendly guy has made friends with an excited beginner at his local card room. The expert sits at the "big" table doing his thing when one day the beginner runs up and says, "can I ask you a question about a hand I just played"?

The expert agrees and the beginner starts, "I was dealt AJs (the "s" means suited), a player raised before me, what should I do"?

The expert replies, "Where was the initial raiser sitting?"

The beginner says, "Under the gun maybe?" (UTG means first player after the blinds)

The expert asks, "where were you sitting?"

The beginner says, "I was one off the button."

E - "How much did he raise it"?

B - "Uh, 3x the blinds, maybe 4x?"

E - "How much money did he have behind"?

B - "Uhhhhh, maybe 30 blinds? Maybe 50?"

E - "How much did you have in front of you?"

B - "I don't know but can you just answer the question?" and storms off (for the brevity of this post but this could go on for a while).

In case all the poker lingo is over your head the point here is the beginner knows the lingo. He knows that AJ suited is a difficult hand to play after a raise and he wants an answer like - "you should re-raise" or "you should fold". The expert understands that there is a lot more too it and the devil is in the details. He can't give a clear answer (to the beginner) but he can point out that the beginner isn't paying attention to the things that make this decision a snap.

If the point here is lost on my fellow SLAyers re-read Appendix E and honestly answer how much characterizing you do before you sit down before the opening bell.
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Everything your learning on the micro from db is necessary,like the noob poker player,everything in market profile i am trying to show you is the intermediate stuff, the next set is pro which you will have to have the previous stuff to understand,and build on your own.and hopefuly you will end up a master
 
On the 5000 tick chart we can see we are at the bottom of the rising coil that has formed over the last few days. The demand line has been fanned numerous times which highlights the struggle that buyers have had moving price higher.

On the 1000 tick chart we can see an channel capturing Friday's price action. Price has ranged several times just below the mean of this channel which is what is currently occurring. In terms of AMT it seems we are somewhere near value which means we shouldn't be looking for trades until unfair prices are reached either at either end of the channel.

On the 200 tick chart price has formed a range from 29 to 36 (mean of 32 ish). I have guests in from out of town so I won't be trading this morning. It believe the exit of the coil on friday, the inability to rally away from the demand line, the sluggishness of the rally of the last few days and our proximity to the longer term down channel indicated weakness and a LOLR of down.
 
Again - not trading today because of family in town.

I think this 3 hour chart says something about the strength of this up move. We are in an overbought position. I believe this implies weakness and makes a return to the mean (at least) more likely than a breakout of the channel. I guess an argument could be made that the lack of volume shows a lack of selling interest but I believe this would have resulted in a faster move up.
 
green.green said:
I believe this implies weakness and makes a return to the mean (at least) more likely than a breakout of the channel.
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From my humble perspective, I make sure to tell myself that this could also mean a change in trend. Perhaps we are seeing a move away from the steeped downward trend channel. Not saying this is the case at all, but I want to make sure my mind is ready for more upside potential, just as likely as a return to the mean. More upside potential would therefore mean a change in trend and a change in mean, so I wanna be ready for it in case the return to the mean doesn't materialize!
 
green.green said:
Again - not trading today because of family in town.

I think this 3 hour chart says something about the strength of this up move. We are in an overbought position. I believe this implies weakness and makes a return to the mean (at least) more likely than a breakout of the channel. I guess an argument could be made that the lack of volume shows a lack of selling interest but I believe this would have resulted in a faster move up.
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Don't dwell on what you think, feel, or believe price WILL do. Focus instead on what it IS doing and what you plan to do if and when certain scenarios present themselves.
 
Thanks Db - luckily I wasn't trading today but the point is still taken. It wasn't much of a market prep but it was clearly biased and I can imagine myself taking a few failed shorts if I wasn't careful (or not taking a long which can be just as big of a mistake). From now on I'm going to try to be more detailed and specific of my plan. Rather than mentioning LOLR or anything about future direction it will be more like a series of if/then statements. If price gets to this level then I will be looking for long entries etc. and some mention of what price is currently doing (or what it did during the OH session).
 
The overnight session has firmed up a range from 87.50 to 77.50. Price pushed lower during the ON and found support at the mean of the previous smaller range. Price looks poised to open below 81. If price breaks above 87.50 I will be looking for a long entry. If price can move below 75 I will be looking for a short entry.

(I'm not trading again today)
 
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