02212019 Thursday — Sellers absorbed at Excess area

21 Feb 02212019 Thursday — Sellers absorbed at Excess area

02212019 Thurs­day — Sell­ers absorbed at Excess area

Ter­mi­nol­o­gy (par­tial­ly made up by yours truly)

• PA = Price Action
• BO = Break Out
• BD = Break Down
• CAR = Con­firm As Resistance
• CAS = Con­firm As Support
• UKC = Upper Kelt­ner Channel
• LKC = Low­er Kelt­ner Channel
• TV = Tick Volume
• WPP = Week­ly Piv­ot Point
• DPP = Dai­ly Piv­ot Point
• DR = Dai­ly Resis­tance (piv­ot)
• DS = Dai­ly Sup­port (piv­ot)
• WR = Week­ly Resis­tance (piv­ot)
• WS = Week­ly Sup­port (piv­ot)
• HL = High­er Low
• HH = High­er High
• LH = Low­er High
• LL = Low­er Low
• SD = Stan­dard Deviation
• VWAP = Vol­ume Weight­ed Aver­age Price
• AS = Asian Session
• LS = Lon­don Ses­sion (EU)
• NY = New York Ses­sion (US)
• R/R = Risk to Reward
• M2M = Move to Move
• T2H = Trade to Hold
• DT = DownTrend
• UT = UpTrend
• LTF = Low­er Time Frame
• TTF = Trad­ing Time Frame
• HTF = High­er Time Frame
• Hypo = HYPOthetical

Per­son­al Checklist

5 pos­i­tive 1 negative	Sun	Mon	Tue	Wed	Thu
-	2/17	2/18	2/19	2/20	2/21
Beers night before	4	0	0	0	1
Time bed yesterday	-	1:07	22:30	23:25	22:21
woke up	-	8:25	7:30	7:39	7:28
Hours sleep	-	7:18	9:00	8:14	9:07
Awake	-	1:11	-	1:40	1:36
REM	-	0:35	-	0:20	1:09
Light	-	4:33	-	4:57	4:58
Deep	-	0:59	-	1:17	1:24
Sleep well?	3	3	4	1	3
Mela­tonin	1x	1x	0	0	0
Neg­a­tive thoughts?	1	1	1	2	1
Exer­cise yester(to)day	4	4	4	4	4
Grat­i­tude	5	5	5	5	5
Joy	5	5	5	5	5
Anger	1	1	1	1	1
Fear	1	1	1	1	1
Focus	3	3	4	2	3
Cof­fees today	1TC	1TC	1TC morn­ing, 1 espres­so afternoon	1TC morn­ing, 1 espres­so afternoon	1TC morn­ing, 1 espres­so afternoon
Inter­mit­tent fasting	no	yes	yes	yes	yes
Water L	3	3	3	3	3
Vit­a­mins	no	no	yes	yes	yes
Cig­a­rettes	0	4	4	1	0

Health review (for the past week)

• Week­ly goal
  • Morn­ing workout
    • Done
  • Inter­mit­tent fasting
    • Yes
  • Rule of 4
• How do you feel?
  • I feel good but still not my sharpest. I slept enough but I think the qual­i­ty wasn’t as good as it could be. I kept wak­ing up because of the injury to my hand. Hope­ful­ly that’ll pass soon.
• How would you rate it (1–5)?
  • 3

The Big Pic­ture (dai­ly)

• What hap­pened yes­ter­day? Where are the tech­ni­cal levels?
  • AS start­ed off by hold­ing val­ue area as sup­port break­ing through LIS and excess area overex­tend­ing over prev high before revers­ing and set­tling in a short term range around the excess area
  • This range sloped up to prev high before LS open and dur­ing the open­ing dri­ve we had a momen­tum play down break­ing excess and LIS overex­tend­ing into val­ue area
  • To then reach new highs after NY opened

Intra­day Fundamentals

• API report
  • Build 1.260M
• EIA report
  • Will come out today. Fore­cast build of 3.080M

Intra­day Tech­ni­cal Analysis

• HTF
  • Define con­text
    • Where were the overnight highs and lows?
      • Highs 57.623
      • Low 55.823
    • Where is the LIS?
      • 56.40 area
    • What didn’t hap­pen? Where do you think it should go?
      • We didn’t BD from the HTF UKC stop­ping the UT on the short term. It looks like it might be the exhaust­ed move at the end of an UT before rolling over into a short to medi­um term DT. It could be the 1st leg of that exhaus­tion move so be on the look­out for the 2nd leg.
    • Where’s the best R/R? Opportunities?
      • Hold­ing excess area as sup­port into new highs
      • BD from excess area into LIS
• TTF
  • Dialling in on opportunities
    • Where are the areas of estab­lished “val­ue” and “excess”?
      • Excess 57.10 area
      • Val­ue 56 area
    • Is there a shift in value/excess migra­tion? What is the cur­rent mar­ket con­di­tion? Are we trend­ing, balancing/range bound? Where are we in the trend range axis?
      • It could be that we were in a HTF con­sol­i­da­tion range into an exhaus­tion move. This doesn’t mean the exhaus­tion is over. It could just be the con­tin­u­a­tion to the HTF UT.
    • What trade loca­tions among this struc­ture would l like to get involved in that will offer me the best R/R opportunities?
      • Hold­ing excess area as sup­port into new highs
      • BD from excess area into LIS
• LTF
  • What has the Asian Ses­sion printed?
    • AS bounced off the Excess area into a pos­si­ble swing LH

Trade Idea

• Hypo 1 Short
  • Hold Prev high as resis­tance BD from Excess area into LIS
    • Ear­ly entry around 57.30 area if real-time analy­sis per­mits, oth­er­wise (add) or entry around 57.05
    • PT around 57.05
    • Stretched PT around 56.90, .45
• Hypo 2 Long
  • Hold Excess area as sup­port into New Highs
    • Entry around 57.20
    • PT around prev high 57.60
    • Stretched PT around 57.90
• Hypo 3 Long/short
  • Same as Hypo2 but overex­tend into prev high and roll over
    • Added short entry around 57.50
    • PT around 57.30
    • Stretched PT around Excess area 57.10, 56.90

My goals for the day (Dai­ly Report Card)

• Define win­ning
  • Per­form well by EXECUTING play­book setups tak­ing only 4 trades and be hap­py by doing what I love and under­stand­ing that I give myself over to the ran­dom­ness of the market

Read­ing the Tape

• What is printing? 
  • 16:05
    • Low momen­tum on bar down to LTF LKC/200MA and TTF VWAP area at LS open 
      • Same area as yesterday’s stretched PT of 57.30 level
      • Poten­tial BD from this level
  • 16:35
    • PA hasn’t made a dras­tic move yet. Wait­ing for the mar­ket to make its move first
    • If there is a BD from this lev­el all hypos still in play. Albeit a slight­ly dif­fer­ent ver­sion for hypo1. No clar­i­ty yet. PA doesn’t seem to drop from this lev­el yet and we might have a swing rever­sal here although not much of a strong tech lev­el on TTF to show sup­port for me to be con­fi­dent in the move.
  • 17:05
    • PA moved to LTF VWAP and I thought my swing rever­sal set­up was already in play so was look­ing to see a con­tin­u­a­tion to the move but we dropped hard into top of excess area
    • PA seems slug­gish again. Espe­cial­ly after cross­ing down the LTF 200MA. 
    • KC and VWAP both widen­ing. PA trad­ing out­side of LKC with the excep­tion of 2 touch­es of the LTF VWAP indi­cat­ing short term DT might be still in effect
  • 17:35
    • PA tried to cross LTF VWAP but uncon­vinc­ing­ly. I do still think a rever­sal here is at play so that’s why I’m stalk­ing a long and didn’t go short. That and bad R/R
  • 18:05
    • PA still most­ly below LTF VWAP. Buyers/sellers lack con­vic­tion to dri­ve PA in a direction. 
    • Accumulation/distribution going on? Sell­ers being absorbed?
  • 18:35
    • 50MA seems to want to cross down 200MA on LTF
    • PA has moved to this lev­el and might be test­ing but still look­ing very uncon­vinc­ing and sluggish
    • TTF looks bullish
    • Not going to take a trade unless I get some more clar­i­ty. I’ll write up notes for my playbook
  • 19:05
    • BO from LTF 50/200MA into LTF/TTF UKC on low momen­tum. Look­ing for a pos­si­ble rejec­tion of this lev­el if sell­ers come in to short accord­ing to Hypo3 but stay flex­i­ble in case of BO from prev high (Hypo2). Then look to enter on PB.
  • 19:35
    • PA moved up in overex­ten­sion area into prev high (hypo3) and seems to have reject­ed this area. I did not short here since the ral­ly to prev high looked ‘force­ful’. Look­ing for a sec­ond touch of prev high before con­sid­er­ing short. PA then crossed back under the LTF UKC and shows a very bear­ish can­dle on TTF. 
    • Lack of buy­ers to bring PA back up to prev high.
    • We now have a momen­tum move down into VWAP
    • I’m going to stay out and just observe and take notes
  • 20:05
    • PA is fol­low­ing LTF VWAP after bounc­ing off 50/200ma (which are flat now), PA again very slug­gish. No fol­low-through on the big bear­ish can­dle on the TTF.

NO TRADES TAKEN

Dai­ly Report Card

Date:	2/21/2019	Week­ly Goal	Exe­cute only 4 play­book trades
PNL (%)	no trades taken
Com­bined Score	79
Process Report Card (10 each)	Per­for­mance Report Card (10 each)
10	Pre-mar­ket routines	8	Hypos
7	Ses­sion PECS	7	Real-time analy­sis
8	Trad­ing the process	7	Trade selec­tion
10	Dai­ly review	7	Trade Exe­cu­tion & Mgmt.
8	Progress toward Week­ly goal	7	Risk Adjust­ed Returns
43	Total	36

• Week­ly Goal
  • Per­form well by EXECUTING play­book setups tak­ing only 4 trades and be hap­py by doing what I love and under­stand­ing that I give myself over to the ran­dom­ness of the market
• Review
  • Hypo3 was play­ing out but I failed to cap­i­tal­ize on it. Rea­sons for this was that I found PA to be very slug­gish with no real fol­low-through on moves. I was stalk­ing a long at the excess area, as per hypo3, and even though I was stalk­ing it I felt an exhaust­ed move should hap­poen. It is now about what I think SHOULD hap­pen but what is actu­al­ly hap­pen­ing in front of me. 
    • How will I try to improve on this? 
      • Even though I think there’s noth­ing wrong with stay­ing out of the mar­ket when it doesn’t ‘feel’ right (in terms of slug­gish­ness etc.) I could have stuck with my hypo3 mar­ket con­text and risked per­haps a small­er posi­tion in accor­dance with this hypo. I’ll work on that. 
  • When PA reached prev. High I yet again failed to cap­i­tal­ize on the rever­sal because I wait­ed for a con­fir­ma­tion in the form of a 2nd touch before tak­ing the rever­sal here. Then soon after it moved away from where I felt is the best R/R.
    • How will I improve on this?
      • This was a swing rever­sal play at a tech­ni­cal lev­el and I should have tak­en this. Besides the pre­ced­ing slug­gish­ness I felt less focused today so that prob­a­bly had a role in this. Nonethe­less, take setups when they arise! With good trade man­age­ment it’s OK if it turns into a loss. 
• How accu­rate was my assess­ment of mar­ket context?
  • HYPO3 60%
• How well did I man­age my phys­i­cal, emo­tion­al and cog­ni­tive states?
  • I wasn’t too sharp and after I had kin­da giv­en up on the mar­ket and decid­ed that I would just sit and observe and take notes I caught myself being pre­oc­cu­pied with oth­er things unre­lat­ed to trad­ing. Gonna sleep ear­ly tonight and hope­ful­ly will have a good rest.
• What’s one thing you learned today?
  • I learned that even though PA isn’t behav­ing in a way I’m more com­fort­able with, the over­all mar­ket con­text might still be valid and could be trad­ed. Dab­ble with small­er posi­tions until this feels more natural.
• What’s one thing I need to do more often?
  • Keep doing the note-tak­ing every half an hour (instead of doing it every few bars like I did before). This keeps my focus bet­ter aligned with the session.
• What’s one thing I need to do less often?
  • Over­think trades. If it fits the mar­ket con­text take the trade.

Feed­back?

Any ques­tions or feed­back you might have please feel free to leave a com­ment or con­tact me directly.