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02212019 Thursday — Sellers absorbed at Excess area

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 negativeSunMonTueWedThu
Beers night before40001
Time bed yesterday-1:0722:3023:2522:21
woke up-8:257:307:397:28
Hours sleep-7:189:008:149:07
Sleep well?33413
Neg­a­tive thoughts?11121
Exer­cise yester(to)day44444
Cof­fees today1TC1TC1TC morn­ing, 1 espres­so afternoon1TC morn­ing, 1 espres­so afternoon1TC morn­ing, 1 espres­so afternoon
Inter­mit­tent fastingnoyesyesyesyes
Water L33333

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.


Dai­ly Report Card

Date:2/21/2019Week­ly GoalExe­cute only 4 play­book trades
PNL (%)no trades taken
Com­bined Score79
Process Report Card (10 each)Per­for­mance Report Card (10 each)
10Pre-mar­ket routines8Hypos
7Ses­sion PECS7Real-time analy­sis
8Trad­ing the process7Trade selec­tion
10Dai­ly review7Trade Exe­cu­tion & Mgmt.
8Progress toward Week­ly goal7Risk Adjust­ed Returns
  • 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.


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


Day trader. Tech geek. Sim Racing Enthusiast.

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