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Once again the Europeans seem to be having all the fun. There are several levels to the down side that could hold up price, including right here. The 50.00 area to the upside could serve as resistance. I will be looking for opportunity from one side of a box to the other until the market proves it wants to move. The only caveat is that there is thickness on the bid today which could mean more downside movement until it is absorbed.
Can you help answer these questions from other members on NexusFi?
Two trades Friday. Both longs anticipating a move from the lower side of the blueprint box to the upper side. Both trades were retracements after breakouts to the tops of highly traded areas at the bottom of the box.
I have been using footprint set to 2 and/or 3 ticks per level to identify areas were a lot of trade takes place. I will then use price’s reaction to these areas as places to initiate trade. It’s a work in progress but I think I am developing a workable system.
There were a couple opportunities that I passed on out of shear lack of trust that could have made this a very good day. I am hoping that as I see my theories play out positively with more regularity I will be more inclined to take these trades.
Oil has been behaving very strangely lately with great Globex moves followed by ranges during RTH. It will not be this way forever. There will come a time when the opposite happens and volatility will pick up during the hours I trade. This is when long moves will occur. Be ready for it.
Combine is still alive after 37 trading days. It is costing money in terms of renewal fees but it is good to have a very specific goal to shoot for.
No bias to start the day. Price currently resides in an area of multiple swing lows so we could see a bounce at any time. To the upside there is a wide area from 48.73 to 49.00 that needs to be tested and could act as resistance. Need to be patient and wait for clear opportunities with good potential.
Price is sitting near the same area as yesterday's open, with several larger swing areas below. My hypothesis is that it will push a little further down today, but it could then bounce up again at any time off of one of these swings.
To the upside there are several areas as marked from the sell off yesterday afternoon and last night that could be tested. There is no evidence as of yet of larger players active in the market today. I'll keep a look out for those first big orders for a clue as to which way they want to take it today.
Oil inventory day and FOMC. The market continues to slowly grind its way toward a major low volume node at around 47.23. Whether it gets there today remains to be seen.
Right now there is resistance above in the 48.15 area and support below all the way from 47.76 to 47.55. Look to the opening range for structure. Also look for highly traded prices to develop to use as backstops for retrace entries. Not many have formed as of yet this morning.
Price currently sits just below a major swing and low volume node on the 2h chart. The volume in the market seems low at this point but there are larger orders on the bid. No major news after 5:30.
With this I have two hypothesis:
Hypo 1: price finds support very soon, then bases up to rally off this major swing.
Hypo 2: price works its way back up to some sort of resistance level then continues to test lower
I would say either hypothesis is about equally possible. In the immediate term I will take a long if volume starts to accumulate at these levels. Otherwise I will wait for some sort of impulse move to the long side and a pull back.
I will look for shorts when price has had a chance to move up into a resistance area of higher trade.
The trend on my time frame is obviously up. It began after a test of a break out area from May. The difficulty of today will be in determining where support is located. Since price sort of stair stepped up overnight, with no clear areas of strong trading, it is anyone's guess where it will stop and reverse, if it is going to do so. I'll need to lean on my 2X and 3X footprint charts to find areas of heavy trade.
Of course, there is always the possibility of retracing all the way back to the bottom, but for now my bias is up and looking for support.
The trend is up but the 50.00 area could be a turn around point. Price has hit is twice so it will be interesting to see where it goes from here. The resistance range is all the way to 50.35 so it could test it a little more.
To the downside I am looking at the 49.62 area as the beginning of support.
High volatility today on the Brexit vote. I need to be very selective in my trading as smaller stops are at greater risk. Find the small streams among the large river.
Price is currently bouncing between ever narrowing levels. There is plenty to be tested above 48.45 and below 47.31. With my stop, bullish and bearish sentiments could change may times today. Be patient yet flexible.
After yet another frustrating day a week ago Friday where I lost on nearly every trade and came close to my daily max loss, I decided this past week, as @GruttePier has suggested, to make some major changes in my trading style. Most of the changes will be tactical in nature.
Try as I might to be a momentum/continuation trader, as some seem to have perfected so well, more often than not I end up on the wrong side of the market, selling at, what is in hindsight, a discount, and buying at a premium. With a lot of patience and discretion, the best I have managed to do with this style is average about 50/50 to +1R, with less than 20 percent of my trade ideas making +2R or beyond. Trading price risk is fine if there is follow through and the trader has found the formula to identify these conditions, but I have struggled to pick the right moments. Too often I enter after price has made the majority of, or at least half of, its move. Apart from Brexit, the action in oil over the past few weeks has not helped. After too much time beating my head against the wall, changes must be made.
The recent Brannigan Barret context webinar was impactful when he talked about trade location in relation to the trend and market position. Others on FIO have been influential: @FuturesTrader71, @Inletcap, @GruttePier, @KahunaDog. I am ready to try an approach that has been very uncomfortable for me, namely, trading information risk. This will include fading range edges, fading significant price levels, and entering on pull backs without confirmation. I will continue to use many of the chart templates and evaluation tools that I have been using. My goal is to take 80% of my trades on information risk, with an occasional momentum play when conditions are just right. At the end of the day, I want to look back on my charts and see the little entry triangles on the other side of the swings!
This first week showed me some promise with the new tactic. Aside from some wild attempts during the evening of Brexit to catch a quick 80 tick mover (almost got one), I added to the account. More importantly, I found that price spent a lot more time in my favor rather than against me, and therefore, profits came quicker, and I was able to get out of some trades at around BE when it was apparent that price was going nowhere. Also had more 2R+ movers.
I think what I will find is that my 1R stats may drop a bit until I get better at identifying significant levels, but I will be able to turn some of the losers into BE and get a lot more out of the winners. The challenges will be in identifying good levels to trade off, and overcoming the fear of getting run over. There is something comfortable about having a recent small swing level behind me rather than trading in space, but that comfort comes with a cost. Time will tell how it goes.
Combine update: 45 trading days, 200 trades, still hovering at around minus $600.
