Hello traders,
I am kinda student addict that adds as much to my trading as I find and think it can help me.
I have thought of nuding my chart to a 20ema but as far as I can follow and use the indicators I have on the chart, will keep them.
I've read and followed a lot of posts in this forum and feel very thankfull to many of you.
I've succesfully implemented some different ways at reading price as I've learned from you.
So I thought it was time to publish my way of understanding of price action reading in the benefit of anyone interested and sure welcome comments help increase deeper understanding for all of us.
My CL price action understanding and explanations get surrounded basically of this different concepts:
- MP Market Profile (MOM book)
- Al Brooks price action
- General technical analysis
The 10/1 CL 5mins chart picture has:
-bollinger bands -black dotted
-15 zlema -red dash
-10 ema -blue dash
-15 ema -yellow solid 2pixels
-20 ema -green solid 2p
-dvalueArea for left aligned volume profile with rtPoc -chocolate colour dash line
-50 ema -midnightblue solid 2p
-200sma -orange dashdot
-GomPOC -darkSlateGray dot 2p (for more accurate POC volume computation thru Gomi package and personal addition N10t_GomPOC indicator)
-daily, weekly, monthly (globex) and IB (Initial Balance range) pivots
You know the H1L2 numbering from Al Brooks concepts can be very subjective. Note also my indicator on the chart only prints actually the letter. This indicator is a variant of the LegHL I downloaded, wich only plots the H or L breaks upon an offset parameter, 4 ticks for CL 5 min bars.
As of the picture chart on EST timzezone we can distinguish the next possible trade locations:
9:00 Open with big gap provides MP structure to think of this day being very similar to previous session action;
9:05 L2 as of DT from overnight first expectance target to 20ema and secondary as biggertimeframe possible seller strenght to go close the gap
9:20 H1 to fade expecting DTP (doble top pullback) as price probes back up into a zone from wich we had lowering poc and vwap
This short thinking situation remains as 15 ema on 5 and 1 mins keep preventing bars to close above.
9:45 L2 triggers below 20ema but with a bit tail, first rejection. After that, bars not able to close above its high and 15emas pushing price down.
Think of another test down, take L3 entry and hold runner for longer sellers probe down.
10:00 News or talking pushing price quicker same dir
10:10 H1 reaction of news move down after reversing pre news price.
10:25 L1 After that previous HOD Reversal bar big tail, take the short first target retest pre news price and emas
But essentially thinking of a move to go retest the buyers biggertimeframe strenght to put a higher low.
10:45 Bullish engulfing reversal 2 bar pattern alerts you possible definitive LOD on 200sma
Long setting up aware of the new TL (trend line) up.
As 10:40 5 mins bar made a new LOD with a tail (not closing below previous LOD) can expect barb wire around until buyers put a clear HL (higher low)
10:50 H1 triggers just to bounce down again at ema20 and vwap at the time
11:10 L2 below 20ema but risky cause the big longer-timegrame trend up alerts you that there is the zone for a possible HL
Poc gets to price
11:20 H2 after a higher low, also DBP (double bottom pullback), with 2bar bullish engulfing and above pit 20ema.
Think at least of a retest previous morning POC and or a continuation of the longer tiemframe strong trend up.
Trade of the day M2B.
12:05 L1 possible short scalp to test the 20ema bounce, after 3 tails up.
As new poc back up again, think price will auction more around and attempt continuation up
After the pullback, go long at 20ema after the cross with poc>vwap
MP reason for the long is also the "transition confirmation" as in the last 2 half hour periods, price traded above the high of the 30 mins bar of the last RE (range extension) down (that was 10:30 to 11:00)
12:20 H3 continuation long after a 2nd HL, can expect another wave up, measure previous moves, think of new HOD …