12262018 Trade Plan — 2nd Xmas day — gap down and accumulation and markup

26 Dec 12262018 Trade Plan — 2nd Xmas day — gap down and accumulation and markup

12262018 Trade Plan — 2nd Xmas day — gap down and accu­mu­la­tion and markup

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)

Per­son­al Checklist

5 pos­i­tive 1 negative	Fri	Sat	Sun	Mon	Tue	Wednes­day
12/21	12/22	12/23	12/24	12/25	121/26
Beers night before	6	10	2	10	0	3 glass­es of wine
Hours sleep	7.5	5	8	6	9	8
Sleep well?	2	1	2	1	3	1
Mela­tonin	0	0	0	0	0	0.5 x
Neg­a­tive thoughts?	1	1	1	2	1	3
Exer­cise yester(to)day	1	1	1	1	1	1
Grat­i­tude	5	5	5	4	5	4
Joy	5	5	5	4	5	4
Anger	1	1	1	1	1	1
Fear	1	1	1	1	1	1
Focus	2	2	3	1	2	2
Cof­fees today	1 espres­so real quick	2 espres­so real quick	1 espres­so spread over 1.5 hours	0	1 espres­so spread over 2 hours	1 espres­so spread over 2 hours
Inter­mit­tent fasting	no	no	no	no	no	yes
Water 2.2L bottles	1	1	2	1	2	2
Vit­a­mins	no	no	no	yes	yes	yes
Time bed yesterday	03:00	03:00	02:00	02:30	10:30	11:00

Health review (for the past week)

• How would you describe your over­all health?
  • I feel a bit sick­ish. I wake up with a cough and go to bed with a cough. I’ll drink more water and take some rest.
• How do you feel?
  • I didn’t sleep too well last night so I don’t feel too sharp. I went to bed ear­ly but couldn’t fall asleep so took a pill. That pill will have some effect today as well. 
• How would you rate it (1–5)?
  • 2

The Big Pic­ture (dai­ly)

• What hap­pened yesterday?
  • Yes­ter­day the mar­ket was closed because of Christ­mas day so I will refer to the day before, Decem­ber 24th as my point of reference
  • We inched low­er on the dai­ly chart and are still with­in the 1.5 and 2.0 SD
• What is the mar­ket sentiment?
  • What does the crowd think?
    • Accord­ing to investing.com today
      • All sen­ti­ments is 60% bullish
      • Last week 54% bullish
      • Last 3 days 54% bullish
      • Bull­ish­ness has def­i­nite­ly dropped but since this is the sen­ti­ment on the retail lev­el we could per­haps assume the oppo­site of this
• EURUSD
  • Dec. 25th
    • High     1.14183
    • Low    1.13678
    • EURUSD: Retail trad­er data shows 47.4% of traders are net-long with the ratio of traders short to long at 1.11 to 1. The num­ber of traders net-long is 7.7% low­er than yes­ter­day and 22.5% low­er from last week, while the num­ber of traders net-short is 3.5% high­er than yes­ter­day and 35.5% high­er from last week.
    • We typ­i­cal­ly take a con­trar­i­an view to crowd sen­ti­ment, and the fact traders are net-short sug­gests EURUSD prices may con­tin­ue to rise. Traders are fur­ther net-short than yes­ter­day and last week, and the com­bi­na­tion of cur­rent sen­ti­ment and recent changes gives us a stronger EURUSD-bull­ish con­trar­i­an trad­ing bias.
    • BULLISH BIAS
• Gold
  • Dec. 24th
    • High    1270.52
    • Low     1255.72
    • Spot Gold: Retail trad­er data shows 80.9% of traders are net-long with the ratio of traders long to short at 4.25 to 1. The num­ber of traders net-long is 0.1% high­er than yes­ter­day and 3.1% low­er from last week, while the num­ber of traders net-short is 27.5% low­er than yes­ter­day and 20.5% low­er from last week.
    • We typ­i­cal­ly take a con­trar­i­an view to crowd sen­ti­ment, and the fact traders are net-long sug­gests Spot Gold prices may con­tin­ue to fall. Traders are fur­ther net-long than yes­ter­day and last week, and the com­bi­na­tion of cur­rent sen­ti­ment and recent changes gives us a stronger Spot Gold-bear­ish con­trar­i­an trad­ing bias.
    • STRONG BEARISH BIAS

Intra­day Fundamentals

• API report
  • The API report will come out lat­er today so I will incor­po­rate it into my trad­ing plan tomor­row since it doesn’t affect my trad­ing today directly
• EIA report
  • The EIA report will come out on Fri­day, Decem­ber 28th
• Geopol­i­tics and the head­lines of today?
  • Stocks under a cloud as U.S. polit­i­cal tumult adds to growth anxiety
    • Slow­ing glob­al eco­nom­ic growth
    • Trump’s hos­tile stance toward the Fed­er­al Reserve chairman
    • U.S. Trea­sury Sec­re­tary Steven Mnuchin had also raised mar­ket con­cerns by con­ven­ing a cri­sis group amid the pull­back in stocks.
  • Dol­lar under pres­sure as U.S. pol­i­tics, Fed wor­ries weigh
    • SINGAPORE (Reuters) — The dol­lar was broad­ly low­er on Wednes­day, pres­sured by a cock­tail of neg­a­tive fac­tors includ­ing height­ened con­cerns over the par­tial U.S. gov­ern­ment shut­down and ten­sion between the White House and the Fed­er­al Reserve.
  • Turkey Stands Firm­ly Against U.S. Sanc­tions On Iran
    • Fol­low­ing Wednes­day’s unex­pect­ed and dra­mat­ic full and “imme­di­ate” with­draw­al of all U.S. forces from Syr­ia, Turkey has announced it will not play ball on Iran sanc­tions. Accord­ing to a trans­la­tion of the Turk­ish pres­i­den­t’s words on Thurs­day dur­ing a pre­vi­ous­ly planned sum­mit with Iran­ian Pres­i­dent Has­san Rouhani in Ankara, jour­nal­ist Abdul­lah Bozkurt reports, “Turk­ish pres­i­dent Erdo­gan says Turkey won’t sup­port U.S. sanc­tions on Iran which he claims puts region­al secu­ri­ty and sta­bil­i­ty at risk, vows to take all mea­sures to min­i­mize impact of sanc­tions on trade between the two coun­tries, pledges sup­port to Iran in dif­fi­cult times.”
  • Syr­ia state media says Israeli planes attack tar­gets near Damascus
    • BEIRUT (Reuters) — Israeli war planes attacked with mis­siles unspec­i­fied tar­gets near Dam­as­cus, the Syr­i­an cap­i­tal, on Tues­day and injured three Syr­i­an sol­diers, Syr­i­an state media quot­ed a mil­i­tary source as saying.
  • British pro­fes­sor returns to UK after deten­tion in Iran: BBC
    • LONDON (Reuters) — A British-Iran­ian aca­d­e­m­ic who had been detained in Iran on secu­ri­ty charges has returned to the Unit­ed King­dom, the BBC report­ed on Tuesday.
  • Syr­i­an army rein­forced close to front with Turk­ish-backed forces
    • BEIRUT (Reuters) — Syr­i­an gov­ern­ment troops backed by Russ­ian forces have sent extra troops toward the city of Man­bij in coor­di­na­tion with the mili­tia that con­trols it, a mili­tia spokesman said, as Turk­ish-backed Syr­i­an rebels said they were prepar­ing to attack it.
  • Ger­man police find Islam­ic State flag after sus­pect­ed attack on railway
    • BERLIN (Reuters) — Ger­man police said on Tues­day they had found a flag of the Islam­ic State (IS) mil­i­tant group near the site of a sus­pect­ed attack on a rail­way track in Berlin and that inves­ti­ga­tors were exam­in­ing whether the per­pe­tra­tors had any polit­i­cal motives.
  • U.S.-led coali­tion reports recent air strikes on ISIS in Syria
    • WASHINGTON (Reuters) — The U.S.-led coali­tion in Syr­ia con­duct­ed air strikes last week that destroyed facil­i­ties used by Islam­ic State, the coali­tion said on Tues­day, less than a week after Pres­i­dent Don­ald Trump declared vic­to­ry over the mil­i­tant group and said he would with­draw U.S. troops from the war-torn country.
• Addi­tion­al OPEC news
  • OPEC might have an emer­gency meeting

Intra­day Tech­ni­cal Analysis

Tue	Wed	Thu	Fri	Week	Mon	Tue
12/18/2018	12/19/2018	12/20/2018	12/21/2018	12/17 — 12/21	12/24	12/25
High	49.9	48.369	47.543	46.816	52.145	46.287
Low	46.12	46.338	45.718	45.179	45.179	44.169
Close	46.247	47.423	46.243	45.439	45.439	44.363
Pip move	378	203.1	182.5	163.7	696.6	211.8
PP	47.422	47.377	46.501	45.811	47.588	44.94
dis­tance	130.2	103.9	78.3	63.2	240.9	77.1
R1	48.724	48.416	47.284	46.443	49.997	45.711
dis­tance	378	203.1	182.5	163.7	696.6	211.8
R2	51.202	49.408	48.326	47.448	54.554	47.058
dis­tance	-247.8	-99.2	-104.2	-100.5	-455.7	-134.7
S1	44.944	46.385	45.459	44.806	43.031	43.593
dis­tance	-378	-203.1	-182.5	-163.7	-696.6	-211.8
S2	43.642	45.346	44.676	44.174	40.622	42.822
TV	72,306	72,350	80,893	72,030	351,797	42,179
50MA	59.267	58.766	58.273	57.775	57.212
200MA	65.999	65.932	65.859	65.78	65.69

• What can we tell from the PP levels?
  • We can see that we dropped quite a bit since one week prior
  • We can see that the lev­els have expand­ed a lit­tle bit in com­par­i­son with last Friday
• Where are the high­er time frame S/R levels?
  • When we look at the Week­ly chart we can see that we dropped to the 42.90 lev­el which is a cru­cial lev­el since we bounced off this lev­el before at
    • Jan­u­ary 2009
    • March 2015
    • We ducked under­neath it Decem­ber 2015 till April 2016
    • July 2016
    • July 2017
  • So we can expect more ‘eyes’ on the mar­ket at this lev­el and let’s wait and see how this devel­ops. It could very well be that a lot of bulls will get in at this level.
• What does the 4H and 30M chart show?
  • We’re under the 200MA and 50MA
    • Way under
      • So we might see a rever­sion to mean
  • Last Mon­day we broke the 45.10 level
  • We are now at the 42.90 lev­el which is a cru­cial level
    • On the sup­port side we have DS2 42.822 giv­ing sup­port as well
• How far away are we from tech­ni­cal levels?

S/R	kind	lev­el	Dis­tance
R6	DR2	47.058	420.5
R5	DR1	45.711	285.8
R4	4H	45.1	224.7
R3	DPP	44.94	208.7
R2	DS1	43.593	74
R1	WS1	43.031	17.8
CURRENT	42.853
S1	Dai­ly	42.9	4.7
S2	DS2	42.822	-3.1
S3	WS2	40.622	-223.1
S4	Dai­ly	39.25	-360.3
S5	Week­ly	37.81	-504.3
S6	Month­ly	26.08	-1677.3

• What has the Asian Ses­sion printed?
  • We gapped down today on the Asian open to the 42.90 lev­el so we should wait and see if we can hold this level
  • The 30M chart might show some accu­mu­la­tion phase price behaviour
    • The rea­son why I am say­ing this is because I am read­ing the book ‘The Art & Sci­ence of Tech­ni­cal Analy­sis: Mar­ket Struc­ture, Price Action & Trad­ing Strate­gies’ by Adam Grimes
      • And in this book he refers to the 4 dif­fer­ent stages of the mar­ket and in the accu­mu­la­tion phase you can see long wicked bars at a cru­cial sup­port lev­el as an indi­ca­tor of this phase. Anoth­er indi­ca­tor is that price will move slow­ly which it is doing right now (keep in mind we are also in the AS so that is usu­al­ly slower)
• ATR
  • What is the ATR on the daily?
    • Is it increasing/decreasing?
    • 2.4275
      • About the same lev­el which per­haps a slight decrease

Trade Plan

• Let’s wait how the 2nd Christ­mas Day is going to affect the mar­ket today
• If we are in the accu­mu­la­tion phase it might be hard to trade off this lev­el. How­ev­er, I’ll be look­ing for a con­fir­ma­tion of a rejec­tion of the 42.90 lev­el and go long
  • This rejec­tion would have to be a move down on the 5M into 2.0 SD and below the LKC and into the 30M 1.5 or 2.0 SD in com­bi­na­tion with a rever­sal can­dle for me to get in long. This could be a great opportunity
• If the mar­ket decides we have a bit more down­side upon us then I’d be look­ing for a break of the 42.90 lev­el after per­haps a move up over the UKC and into the 2.0 SD which could be the 1.0 SD on the 30M as well with a rever­sal can­dle on that side show­ing weak­ness in buy­ing pres­sure and com­mence the rollover and head down.
  • Anoth­er sce­nario might be a squeeze on the 5M with a BD and to LKC with con­tin­u­a­tion of the move then I’ll be short­ing at pull­backs to MAs
  • The same can be said but invert­ed on the upside.

My goals for the day (Dai­ly Report Card)

• Only take 4 trades
• Only take PB setups

Read­ing the Tape

• What is print­ing? Look for PA with high­er TV and S/R levels.
  • Before Lon­don open dur­ing the AS we have only ranged in a squeeze (PA was basi­cal­ly flat)
  • The main mar­kets aren’t open today so don’t expect any­thing from the mar­kets today. The spreads are high­er than usu­al which is to be expected.
    • The only ones that are open now are the 
      • RTS     Russ­ian Trad­ing System
      • DIFX    Dubai Inter­na­tion­al Finan­cial Exchange
      • NSE    Nation­al Stock Exchange of India
  • We made an effort to break­out from the inter­sec­tion of 
    • 30M VWAP mean
    • WS1 43.031
    • 30M S/R lev­el 43 level
    • I am not too com­fort­able to go long here even though I think I should
      • I feel more com­fort­able if I can see a hold­ing of the resis­tance lev­el and thus have a set­up for a swing rever­sal play
  • Also the spread is still around 34 with some jumps to 40
    • Also we are enter­ing the tight­en­ing of the VWAP bands on the 30M so that is anoth­er lev­el of resis­tance we have
      • Let’s wait and see if we can break that level
  • Looks like accu­mu­la­tion on the 30M but looks like dis­tri­b­u­tion on the 5M so let’s see what’s up
  • It looks like we broke through the 43 level
    • We made a fake rever­sal back into the KC and then spiked up. I was think­ing to go long here but I am not feel­ing very sharp today so I’m extra cau­tious. I want to doc­u­ment this sit­u­a­tion so that I could per­haps trade it in the future.
  • NEWS
    • Pri­vate buy­ers of Iran crude had no prob­lems export­ing it: oil minister
      • Iran began sell­ing crude oil to pri­vate com­pa­nies for export in late Octo­ber, just ahead of U.S. sanc­tions on sec­tors includ­ing oil which came into effect on Nov. 5.
  • T1
    • Win 5 ticks

Trade Man­age­ment

Explain what trade you put on (include price, SL, TP) and what your thoughts are dur­ing the trade

• T1
  • Why? What do I see?
    • UKC BO continuation
    • Price dropped to UKC and I took a long position
    • Since I am not too com­fort­able with con­tin­u­a­tion movers I took a tiny position
      • Entry
        • 43.255
  • SL
    • 42.938
      • Just at the bot­tom of the upthrust can­dle (is this the upthrust can­dle by Weikoff?)
  • TP
    • 43.747
  • Trade Man­age­ment
    • We dropped back to the UKC and might be going against me. I have my hard stop in place
    • Cov­ered at 43.306 for a 5 tick profit

• T2
  • NOT TAKEN

• T3
  • NOT TAKEN

• T4
  • NOT TAKEN

Trade Review

• Did you let your trade play out or did you cov­er or stop out soon­er? If so, why?
  • I am focused on just tak­ing my PB setups and let­ting trades ride out is a goal for anoth­er time

Dai­ly Report Card

• Only take 4 trades
  • Only took 1 trade
• Only take PB setups
  • Yes I did.

Feed­back?

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