good stuff...but, I question why did not it retrace back to earlier lows?...that is why I went short...
Here dude Also, this is the first time Ive ever looked at a chart of sugar, but this looks like a shitty contract to trade. FWIW, find something with a bit more liquidity.
Look at the price action. It made two prior attempts to head south, and it bounced both times. Wait for that level of support to be violated.
A better contract may have given you an earlier short signal, then you could have rode a short position down to the fist support, then waited to see if it broke down to those earlier lows, exiting with a small profit if that first support held. But in this case the breakdown kinda came out of nowhere and went almost all the way to the first support zone, no real short entry there. Your risk was a retracement all the way back to that trading range but your reward was nothing more than a few ticks. Stop it! Have you looked at 6E at all? I know its more fun to say you trade something wacky like coffee or whatever, but the boring ole' Euro contract provides some nice set ups and liquidity. When you get comfortable and have more money to risk practice CL on the sim for a while. Its got great tradeable price action, its just not for the faint of heart.
thanks Man... according to my current personal $$$ risk/margin evaluation I am better off not trading the Euro right now...here are the contracts that currently meet my personal $$$ risk/margin evaluation standards: CME Globex CAD CME Globex Swiss Franc YM mini-Dow Sugar mini-Gold ...actually, the CL is ultimatelly where I want to be...sometime...but can't with my current risk/margin evaluation...BUT, If I just become a 'master' at one of the above mentioned contracts and then there would be no need to trade the CL...thanks!
Care to elaborate on your personal $$$ risk/margin evaluation? Margin requirements I get, but why are you able to risk less trading sugar over beans, etc? CAD or YM would be my choice off that list. And if you become a master of any one of those you will be able to raise enough cash to trade anything you want, while putting masterful trades on in your original contract Price action is price action, and a market is a market. Each market may have some little quirks you need to get used to, but in the end its all moved by the psychology of supply/demand. Once you look at the market through the lens of price action as a function of supply/demand your trades will be less stressful, allowing you to watch a couple more contracts.
sure, I use a calculation of taking into consideration of of the following items: -daytrade margin -my account balance -per point value -volume-liquidity-slippage -high/low range -recent volatility-wild swings or no? -tightness of bid/ask spread ...thanks
When it failed to make a lower low (right around 10:30 or so), chances are it will make a higher high. Spd laid it out well: You have buyers jumping in just below previous support. This was a failed breakout and it's trapped a load of shorts who expected it to break down further. But the buyers came in aggressively just below that support level, leaving a wick. Once price failed to break down further and went up instead, all the shorts are now getting stopped out and the longs who got stopped out just below previous support, are really pissed they got shaken out and now they chase the market to get back in. That's where that big green bar comes from.