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Learning to trade the ES using volume profiling


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Learning to trade the ES using volume profiling

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  #321 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received

1. Sold 1589.5 on 4 pt move. Why did I take this trade, I just completely manufactured this trade because I missed the long all morning and wanted to try a short after it 1 ticked the 90 hi. Hopefully they let me out with a scratch. Stopped after a few minutes and 0 MF. So stupid....




Recap
ES opened OAOR and responsive sellers made first push into prior range but failed to get into prior value and from there bulls auctioned it higher thru the day before some selling on the close. ES stopped 1 pt short of new all time hi's. Overall value and vpoc shifted higher. Price closed higher, inside value on very poor volume at barely over a mill (1.03). Profile shape was pretty ugly but vaguely p shaped.

Terrible day. Made only 1 trade and it was so stupid. This market wouldn't let you in as there were no pullbacks greater than 2.5 pts after the low was made until the end of the day. I should have just gotten long when it popped thru the OSHI the second time after rejecting pRange. Shoulda woulda coulda.

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  #322 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received

Economic data: PMI, consumer confidence

ON Profile: Very tight 4.75 pt range overnight on small volume (144k). It was basically an inside session of yesterdays value area. Really I dont think a whole lot to be gleamed from it other than yesterdays gains were held and market appears to be waiting for info.



ES is set for an OAIR opening with big numbers coming out around 9am so I think the first half hour will be directionless chop and then the 9am numbers will set the tone for the day. Longer term trend is up with the short term balancing but near the top of its balance zone and all time new highs just a few points away. I cant help but think of the horrendous volume the last few days but just brush it aside for now I guess. Yesterdays profile looks pretty poor in the lower half so I can see people using the numbers as an excuse to sell off and repair that but then the bulls jump in and grind it higher again.

Levels Above: 1593 all time hi

Levels Below: 1584 MP single, 1582.75 CHVN, 1577 nvpoc, 1573.5 CHVN*, 1570 CLVN

Hypo#1- ES opens OAIR inside value and chops before numbers and sells off to 1583 where buyers step in and grind it higher through the day to new all time hi's.

Hypo#2- ES opens OAIR and chops, peaks above yHi/all time hi and gets rejected allowing sellers to step in and trash it targeting 1570.

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  #323 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received


1. Bot 1583.75 MP single on 3.25 pt move a few minutes before the 9am number. Scratched after 3 minutes and .5 MA vs .75 MF.

2. Short 1585.25 mid/ONLO on 3.75 pt move, dVAH 2 ticks above along with VAL from yesterday. There is a double bottom at the low but otherwise it looks pretty good which works against this trade. Developing value clearly lower on the day but maybe the low is in. Stopped after 5 min and 0MF.

3. Sold 1589 IBHI on 2.5 pt move after just 1 ticking the prior 1 tick with 2nd vwap at 1589.5. I cant believe how stupid that is after I typed it. Its gone against me 4 ticks and printed only 98 at the ONHI so maybe this trade has a chance. Stopped after 13 minutes at 0 MF.

4. Long 1589.5 vpoc. ES has tried 3 times now to break IBHI at 1589 and failed and we have a poor hi above with a double top on daily time frame so I took the long from the fairest price of the day. Scaled after 19 min and .25 MA. Second scale given.

5. Sold 1590.75 just trying to play some momentum of end of month games into the close. Stopped after 2 min. Paid the price.




Recap
ES opened OAIR and sellers made first move only to run out of steam and allow buyers to grind it higher thru the day. Value and vpoc shifted higher but only marginally so. Price closed on highs, above value and above pHi and additionally set another new all time hi by a tick. Volume was average at best at only 1.34 mill. Not much has changed on the composite as 1573.25 is still the most accepted price since the 1530.75 low but 1582.75 is right there with it and another day of trading there should shift it to the vpoc.

I am so unbelievably frustrated with trading now and those two garbage trades I made today I think are proof of that. Plain and simple the market is just clowning me. I keep getting suckered into bad trades because I can't discern context well enough. I firmly believe you have to make tons of crap trades first before you realize they are crap before you take them and actually begin taking the other side but how many more of these do I need to make for that to happen???

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  #324 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received

Economic data: ADP, ISM, Construction, FOMC

ON Profile: Today is a european (and brazilian) holiday so nothing happened last night. ES has a 4 pt range on miniscule volume (78k). A new all time hi was set at 1595.5 and the low is at 1591.5, yesterdays vpoc to the tick. Profile shape is balanced. Really not much else to say about it.



ADP is out and market sold off a few points. Normally on FOMC days I expect a 4 handle chop fest until the number. Today we have 2 big numbers coming out at 9am which could make some noise. Assuming they don't, the plan is for an OAIR to chop around for 4 hours until FOMC and then some potential craziness. If price spikes above pHi and gets rejected then sellers can auction it relatively easily down to 1582.75. If prices above pHi are accepted then 1600 is the magnet I would think. All time frames are trending higher.

Levels Above: 1593.25 pHi, 1600

Levels Below: 1591.5 nvpoc/ONLO, 1588 LVN from yday, 1582.75 CHVN*, 1577 nvpoc**

Hypo#1- ES chops for 4 hours before spiking lower on FOMC then auctioning higher into the close.

Hypo#2- ES chops for 4 hours before FOMC, spiking above pHi but rejected then sold into the close down to 1583 level.

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  #325 (permalink)
Birmingham, AL
 
 
Posts: 1,065 since Apr 2012


Profiler View Post
I firmly believe you have to make tons of crap trades first before you realize they are crap before you take them and actually begin taking the other side but how many more of these do I need to make for that to happen???

You should be learning something from every trade you take. Are you?

Do you do more than just say... well this was dumb or that was dumb?

Do you have a process for review at the end of the day where you see what you could have done better with your entries, with your exits, with your stop placement, with your trade management? What you learned that day about how price reacts to x or y, or how trends form, or how it looks when trends change, how intraday price ebbs and flows, how things played out versus the context you were seeing, etc, etc,

Don't just get frustrated and call your decisions dumb. Get better.

Keep up the good work.

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  #326 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received

1. Long 1588 LVN/yesterday afternoon swing low on 7.5 pt move right into the open. Stopped after 20 min and 1.5 MF.

2. Sold 1586.25 mid/prior day VAL on 2.5 pt move and only 115 printed on offer above at 1586.5. Not confident in trade at all as low looks good from key area at 1582.75 CHVN to the tick. Stopped after 10 min and .75 MF.

3. Long 1582.75 dVAL/IBLO on 3.5 pt move down after re-entering value and trading almost up to vpoc before being rejected. Hmm, as I think about value has not been moving higher today so maybe this trade does not make sense. Scaled after 16 min and 1.0 MA. No second scale.

4. Long 1577.5 on 2 pt move after 1577 nvpoc printed weakly. Its late in the day so who knows how this will work out but we are trading below 2nd vwap. Scratched at bell after 1.5 MA vs 1.0 MF.




Recap
ES opened OAIR and really made no upside progress at all allowing the bears to pressure it lower. Value was decidedly lower along with vpoc which shifted down to lows at the close but I am not sure that really counts. Price closed on lows as well. Volume once again below average at 1.29 mill. Daily candle looks pretty red but it was a 13 pt range which is totally average and bulls are still in control. The composite and MC still does not change much after today but it appears that 1582.5 is really being fleshed out as the fairest price in the region.

So my expectations for today were completely off base. I was thinking 3-4 hours of chop into FOMC and then some action but instead sellers were far more aggressive out of the gate than I imagined. I've got to stop taking mid trades when there is a strong reaction off the low, especially from known reference points. @indextrader7 My intentions for describing trades as dumb are to sear into memory what I did and not do it again. I like to think I am learning in this process but each day when I review my trades and look at the chart and see where I was active vs where I should have been active I don't really like what I see. The thing about my writing here is that I may seem super depressed or frustrated or whatever with my progress or lack thereof but overall I remain incredibly optimistic and focused.

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  #327 (permalink)
Birmingham, AL
 
 
Posts: 1,065 since Apr 2012

Two questions:

What are you taking away from your trading today that will make you better tomorrow?

Where were your ideal trades today, and what could you have seen in real time to see them unfold?

Another thing. To me, you seem defensive to most every critique you receive. If you don't want any critique, then please let me know and I'll spend my time elsewhere and there will be no hard feelings!

Looking forward to your answers brother.

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  #328 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received

I'm not being defensive, you are being defensive! Im kidding, theres an old SNL skit that is good for that. If i seem defensive about my critiques, its unintended. I fully welcome any critique and invite you to do more any time you want. I do realize that i come off as defensive though and wish i could change that but i just suck at conveying the proper tone i want to convey through writing.

what do i wish i did today? well today seemed pretty tough actually. I wish i had grabbed a long the first time down to 1582.75 because that was a level i was considering pre-market and once it traded i tried jumping in at 1583.25 but didnt get the fill thought about buying 1583.75 but passed and then watched it go up. Worse I decided to take a short at the mid. Im done taking mid trades with strong reactions off known reference points and vpoc up above. I've done that trade a few times now and this was the last straw.

I was thinking about the short at 1581.5 after 2 consecutive inside brackets on MP and going with the breakout but passed. Otherwise, I dont know what would have been good trades. Obviously a short from 1589 would have been the bees knees but what would the reasoning have been?

What did you see today?

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  #329 (permalink)
Birmingham, AL
 
 
Posts: 1,065 since Apr 2012

Awesome man, glad to hear it.

Yeah, a long of 82.75 area would have been good early on. I was short from 88's on a trade I called out in the S5 chatroom (not sure if you were there) as we headed down there. I was bearish on the day based on how the overnight action took a peek above and was strongly rejected (also something i talked about in chat before the open). So I was bearish, and I had a short position on, and I was looking for 81 as a target, so that level caught me by surprise. I exited the short down there around 84 as it reversed, but didn't have the flexibility or the game plan to get long.

Once we traded above prev MP VAlow, I got long at 87.25, then added to that long at 85. This was a violation of my risk plan, so I scratched at BE and shut everything down for the day.

Honestly that initial entry was more a decision out of fear, because I wanted to get long, but also wanted to wait for a pullback, but was afraid of missing the move.

I can say that if I were to have continued to trade I would have certainly seen that right after 11am cst, when I was exiting my violated trade... I would have shortly been looking to get short because we took that attempt above prev VA low and couldn't accept prices above. That's one of the biggest things I look for often times... what important area do we violate, but then can't stay above/below and accept prices there. I call it a breakout failure, as do many others. It's a great setup as there are trapped traders from the other side of the trade positioned for the breakout of the level to succeed. We profit as they puke out.



So that's all I have for what I saw today. What had 82.75 on your radar pre market?

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  #330 (permalink)
Rio de Janeiro, Brazil
 
Experience: Beginner
Platform: SC, S5T
Trading: Es
 
Posts: 617 since Jan 2013
Thanks: 321 given, 589 received



indextrader7 View Post
What had 82.75 on your radar pre market?

Its the most traded price on the composite above 1554 so I thought if it came down to there buyers would again see it as a good price to buy. I didnt have a resting bid there though because I was concerned about it holding for a second time as tuesday tested it and bounced from there as well.

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