Price is in a downtrend from the open and below the Supply Line. The possible set up to buy at 32 would be a Double Bottom counter trend reversal trade. Reversal trades needs something to reverse which is an extended move. That is not the case here, any up move would soon be met with overhead resistance and potential new sellers. the better reversal trade would be around 10:15 after the DB, TL break and now a HL. I would not short off resistance until it was proven to be resistance when the failed break out occurred. Failed breakouts of important areas , the overnight high and HOD here, are indications of weak buying and a potential reversal.
Additional reason for passing the long off 32: Price approached 32 not in one clean downwave, but instead through a series of waves and significant Rev waves (at 0936 and 0950 EST). While the LH's from these wave implied selling pressure, the formation of the Rev waves produced a lot of trades and any long off S would have to go through them. Basically, going long here would be taking a trade in the middle of a larger value zone in anticipation of going through a lot of immediate congestion.
Hey db the ndx sold off 12 points this am then it had a retracement of only a couple of points setting up a lower high short which I see as a good entry then the next leg down is only around 9 points is this a sign that supply is drying up because the down wave was smaller than the last one?
How might a Wykoff expert have traded CL today? I'd like to see a chart if possible. Ideally 5 min bar interval, but I know you guys like the 1 min chart so that'll be better than nothing.
For now, let's focus on the air pocket. An air pocket is an area where price moved so far so fast that there are few if any trades at any given price point, i.e., price can whiz right through a level without any prints at all. Because of this, one will find little if any support if the pocket were an upsurge or resistance if it were a downdraft. In this case, the area from 3195 to 3220 constitutes an air pocket. Frankly I was expecting a little drama, particularly since it's Friday, but those buyers, bless their hearts, spent the entire afternoon throwing sandbags on the levee. Whether it will be enough or not remains to be seen, but futures won't be trading much longer, and the clock is ticking. I'm a little surprised that anyone would want to hold here till Sunday, but this particular approach (the Straight Line Approach) prevents me from allowing my expectations to interfere with good trades.
No idea what a Wyckoff expert would have done, and Wyckoff and I haven't talked lately, but I'd guess that he'd have shorted the lower high at 0950. Of course it's all hindsight and worth what a trade that's already gone would ordinarily be worth. But if one had noted yesterday's weakness and the feeble attempt to rally that resulted in the swing high at 0500, he might have pounced on the even feebler attempt to reach it, much less exceed it, at the open. This would of course require a thoroughly-tested and consistently-profitable trading plan.
A little more time here, so let's look at #1. Rather than think in tradertalk I tend to think in terms of metaphors. This whole area that got started at Wednesday's lunch reminds me of an aquarium, one which hasn't been cleaned in a LONG time and has lots of muck in the bottom. This became even more mucky this morning when price first tried to pull itself out of the muck at 0815 after having been plunged into it after 0715. It did manage to reach 40 just before the NY open, but then it got dragged down again. If one thought that "support" had been established by that pre-market touch and tried to go long at what he might have perceived as a "test", he would have had a hell of a time doing so even if he applied this approach, getting stopped out more than once. Price doesn't even reach clear water until it gets past 37, and even then it gets pulled back again at 1030. But then we reach the surface and bob up above it for air. There's nothing up here. No resistance at all. But no support either. No muck. So if and when price were to fall, it would most likely fall a lot easier than it rose. Which is what it did. Guess it was tired after pulling itself out of all that muck. Point is, you'll know when the trade is right almost immediately. As Teresa Lo once said to me, if it doesn't go, you don't want to be there. Incidentally, there won't be much if any of this sort of "analysis" in future since it's all fishwrap in a day or so anyway. I mentioned today's activity only because it jibes with the opening posts and provides a current -- or was current at the time -- example of application. And there's that air pocket.
I have two pieces of stringâ¦, one longer than the other What color are they This is essentially what youâre asking ================================ Weâre trading PA here â support/ demandâ¦. resistance/ supply⦠& trend If you would frame your question(s) with this in mind â likely youâll get a response Otherwise â what color my string Not being an ass - rather just sayin RN