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Learning to trade the ES using volume profiling
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Learning to trade the ES using volume profiling

  #201 (permalink)
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Profiler View Post
was shorting yesterdays hi basically a layup? Because I don't get it!

How about actually being short and getting out for 1tic+ uuuurghhhhhh

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  #202 (permalink)
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I also failed to mention I was also confused and I didn't take any trades today. But I am playing a bit of a Monday mourning QB.knowing your trades turned out losers it's easy to say what I said. If they turned out winners which they easily could have. I would b saying man he's good what the hell does he see.

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  #203 (permalink)
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Profiler View Post
1. Long 1549.5 LVN/OSHI

2. Long 1546 MP single on 5 pt move down.

3. Shorted 1546.5 LVN on 3.25 pt move. Would have been winner...

4. Long 1546 vpoc on 1.5pt pb.


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First let me say that I am enjoying your journal and I want to give some of my input-I was helped immensely when I first started trading and I think its only reasonable that I pay it forward. Please forgive if it makes you feel bad or negative and next time I ll keep it to myself.

The 3 entries that didnt work you took all of them against the trend while price was dropping-check the candles-each dropping candle doesnt even retrace into previous candle just keeps dropping. Going against prevailing wind isnt the way to trade no matter what methodology you are using. Better to flow with the wind in your sails. You have to let the price trade at your level for at least a couple of candles, I know anxiety of a missed trade sets in but try it next time. The one trade that would have worked is precisely that way-price trades at that level before falling. Just my 2c. Try it next time and keep a post it note if it works.

Just another Question why didnt you hold onto the short from 46.50 on the 50% retrace--the retrace to mid is one of the "top" VP setups out there. Esp since you were stopped out at same level, now its going back to test the level where you got stopped out. I had same trade and it was the best trade of day for me +4.5. 47.50 was a great level yesterday-price couldnt break thru to downside and today to upside. Mark it down.


Last edited by garyboy275; March 12th, 2013 at 11:31 PM.
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  #204 (permalink)
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garyboy275 View Post

The 3 entries that didnt work you took all of them against the trend while price was dropping-check the candles-each dropping candle doesnt even retrace into previous candle just keeps dropping. Going against prevailing wind isnt the way to trade no matter what methodology you are using. Better to flow with the wind in your sails. You have to let the price trade at your level for at least a couple of candles, I know anxiety of a missed trade sets in but try it next time.

Just another Question why didnt you hold onto the short from 46.50 on the 50% retrace--the retrace to mid is one of the "top" VP setups out there. Esp since you were stopped out at same level, now its going back to test the level where you got stopped out. I had same trade and it was the best trade of day for me +4.5. 47.50 was a great level yesterday-price couldnt break thru to downside and today to upside. Mark it down.

thanks gary for the comments and no worries, you didnt make me feel bad. feel free to post any time you want. i have to respectfully disagree with your assertion that one needs to wait for price to trade at a level for a few candles before jumping in. thats your style and it works for you. i have no style (both in trading and fashion) so i am just being precise to the tick for everything, on first touch but i know FT71 definitely would not say "you must wait for a few candles to trade at your price before getting in" and his style is what i am trying to emulate (until i can make my own).

as for why did i scratch that mid trade... man i was flustered after the 2 previous losing trades, it was a powerful instant spike 5 ticks against me that i did not see coming and i was cursing myself for frontrunning the mid by 2 ticks and i just panicked and wanted out. tip of the hat to you for staying in it!

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  #205 (permalink)
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Profiler View Post
i have no style (both in trading and fashion) so i am just being precise to the tick for everything, on first touch but i know FT71 definitely would not say "you must wait for a few candles to trade at your price before getting in" and his style is what i am trying to emulate (until i can make my own).

as for why did i scratch that mid trade... man i was flustered after the 2 previous losing trades, it was a powerful instant spike 5 ticks against me that i did not see coming and i was cursing myself for frontrunning the mid by 2 ticks and i just panicked and wanted out. tip of the hat to you for staying in it!


As for spike I saw that and I almost did what you did--but I walked away from my monitor and I had nothing to do and was standing at the door (seriously) waiting 5-10 minutes-did a few pushups, wasted time and came back for sure expecting a stop out but it was happily trading well below entry.

I am not trying to change your style just adding another viewpoint. You can low tic or high tic when you have strong conviction in a fast moving market-doubt you would be able to do it in a slow orderly market like we ve had for the last month or so. Again I am humble and not trying to change your style just adding my 2c.

The first 2 losing trades shouldve had nothing to do with the next trade--I know easier said than done but come on man-just do it!! We expect better next time around--OPEX week can be tough so dont beat yourself thrus/fri should bring increased volatility.

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  #206 (permalink)
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@Profiler, looking at the bigger picture of the last few days, here is a profile of the gap up Tuesday 3/5 through Monday of this week, and then Tuesday's trade and profile on the right.

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No doubt you have a similar view, but after doing it this way it gave me a bit of a different perspective and I thought you might want to have a look. You can see the area of around 46.75 to 48.25 being an area of rejection (from the highs on Friday, to trading through it and forming a distribution above on Monday). You can see another area of relatively low volume from 40.75 to 41.50. Below you see the 38s, and the 35s. My volume numbers may be a little different from yours (I have a more prominent peak at 38s probably) because my Thursday is ESH, whereas yours is probably ESM, but overall they are similar.

The market found support and rejected 47s at the open, the first area mentioned above. It then rejected 47s as it traded through on the way down. It rejected 47s again after the 43 low was put in. Then the LOD was made at 41.75 which is yesterday's low and just above the low volume area. Finally, 47s again provided resistance and rejected further upside at the close.

This is all good and well in hindsight and not so easy to trade in real time (obviously for me, as I mentioned I had a few losers in this area), but I thought I would post some observations of the areas (not specific prices, more like 4 to 6 in each area), and how if I had viewed them in this light, perhaps I would not have been so eager to trade 46s for example, though it was important on Monday. Bringing in Tuesday's trade pretty much gives the same picture, with a more prominent development between 41s and 47s of course, both of which areas I think could be very important tomorrow.

Clearly the 47s are important, largely due to it being the high last week. Incidentally, the long I took off the low at 43 was partly due to it being Monday's low, but was also largely due to the DJIA at this same time testing its Friday highs (from the upside, as the S&P had been unable to breach from underneath earlier!), dipping below, and finding good volume and support. The dow, useless as it may seem to me being a 30 stock index, is on everyone's radar, and it provided some good information in this case.

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  #207 (permalink)
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3-13 pre-market

First off, thanks to everyone who posted yesterday! Definitely a benefit to having a blog here is people offering their knowledge to you. Aight, back to the routine...

Economic data: retail sales, import/export, biz inventories

ON Profile: Weird looking profile with vpoc stuck 2 ticks off the lows which you would think forebodes more downside but as we learned yesterday thats not necessarily the case. The hi stopped a tick short of the 1550 level and the low is just a tick below the VAL. Not really sure how to describe the shape- maybe picture bozo the clown holding his arms out for a hug? ES auctioned higher initially last night, above the ~1547 level that has been important the last few days but then fell back into the bottom distribution where it spent the majority of its time.
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Very interesting day on tap potentially. We now have a double bottom on the daily chart at 1541.75 to the tick. I don't expect that to hold on 3rd test. Question is will it fall out of the balance area bounded by ~1540 area and seek out the HVNs at 1538 and 1535.25? Yesterday I was stalking a long at 1540.5, today I don't think it makes sense. SO retail sales are out now and market is reacting very positively to it, up near the hi, definitely changes the picture. I am expecting an OAIR, right near the VAH which is kind of the line in the sand. Where will the ES be accepted today? If above, those poor hi's from the last 2 days are certainly juicy targets. If below, that double bottom has a bullseye. All time frames point higher still.

Levels Above: 1549.5 lvn, 1551 poor hi

Levels Below: 1546 nvpoc, 1541.75 double bottom, 1540.5 nvpoc/ BAH, 1538.25 HVN, 1535.25 CHVN**, 1531.5 LVN

Hypo#1- ES opens OAIR pushes lower to nvpoc at 1546 to pick up buyers then targets poor hi in grind higher.

Hypo#2- ES opens OAIR and pushes into upper distribution but fails then heads lower targeting 1541.75 double bottom and possibly below 1540.

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  #208 (permalink)
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3-13 trades and recap

1. Sold 1547.75 LVN/top of distribution on 5 pt move pre-market. This area has been a key level the last few days so on a big rotation into it I took the fade. 22 minutes in and 4 ticks against me, not looking good. 53 min and now 2 ticks in favor a few minutes before the open, didn't anticipate being in this trade for so long. Filled just after open. 57 min and 1.0 MA. Second scale given if stop at original, if moved to BE, no second.

2. Long 1545.5 LVN 1 tick ahead of mid/vwap on 2.5 pt move. Breadth 10, tick -445. I think I just heard PB sigh when I pulled the trigger on this based on its location. Vpoc is above at 1546.75. Bears gave it their best this morning but pulled up lame at the double bottom so I was looking long but didn't know where until finally this pb. Distinct ledge below at 1545 which I hope will act as support. Negative being the prior up move failed 1 tick below hi and at the 1547.5 level that has been controlling things lately. Scaled after 20 min and .25 MA. Second scale given.

3. Long 1547.75 level from this morning on 2.5 pt pb. Breadth 121 and tick -443. ES broke out above the mini-dividing line at 1547.5 and formed a nice balance area above at 1549 and double top from yesterday to the tick with a poor hi left in place to support a long. Volume is atrocious though which goes against the long, plus this trade is in the upper quadrant of the 40-50 balance area we have established over last few days. 3 ticks against me with some pretty heavy volume traded below. IBHI is 2 ticks above and buyers are just pecking at it weakly. Scaled after 24 min and .75 MA!
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Recap
ES opened OAIR right at the VAH/diving line between 2 minor balance areas. A probe into the top distribution was strongly slapped down and for a moment it looked like a rout might be on. But these weren't the sellers we were looking for for that kind of action. They stopped at the ONLO to the tick, pulled back then made another attempt lower but pulled up lame 2 ticks before the double daily bottom. Buyers absorbed all supply then the usual rally took place. These buyers too lacked conviction, stopping at yesterday's hi to the tick. At the end of the day, value shifted higher, vpoc continued its march higher and the ES closed up a few points. Volume barely cracked a mill so totally bushleague and the one chink in the armor of this rally. Daily candle gives us an inside day and 3 days in a row of tight balance with the mc vpoc at 1549 or 1546 if you use 4 days. Could be a breakout coming tomorrow...

All 3 trades worked out today and gave second scales which is nice, especially after yesterday. Im pissed I missed the mid trade I posted on the chart but I thought it would trade up to 1546 first because of that low volume zone. Otherwise it was a cherry set-up but it did give only 1 scale. Time to relax and watch the champions league...

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  #209 (permalink)
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Nice work P.

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  #210 (permalink)
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Nice work - that Mid at 45.50 was the bomb. Set up very cleanly too. Measure move from low to top back to mid, from mid to high was expected 51 which was the day high.

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