
27 Dec 12272018 Trade Plan — Pullback after huge rally
12272018 Trade Plan
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 | Sat | Sun | Mon | Tue | Wed | Thu |
12/22 | 12/23 | 12/24 | 12/25 | 12/26 | 12/27 | |
Beers night before | 10 | 2 | 10 | 0 | 3 glasses of wine | 4 |
Hours sleep | 5 | 8 | 6 | 9 | 8 | 8 |
Sleep well? | 1 | 2 | 1 | 3 | 1 | 2 |
Melatonin | 0 | 0 | 0 | 0 | 0.5 x | 0 |
Negative thoughts? | 1 | 1 | 2 | 1 | 3 | 1 |
Exercise yester(to)day | 1 | 1 | 1 | 1 | 1 | 1 |
Gratitude | 5 | 5 | 4 | 5 | 4 | 5 |
Joy | 5 | 5 | 4 | 5 | 4 | 5 |
Anger | 1 | 1 | 1 | 1 | 1 | 1 |
Fear | 1 | 1 | 1 | 1 | 1 | 1 |
Focus | 2 | 3 | 1 | 2 | 2 | 2 |
Coffees today | 2 espresso real quick | 1 espresso spread over 1.5 hours | 0 | 1 espresso spread over 2 hours | 1 espresso spread over 2 hours | 1 espresso spread over 2 hours |
Intermittent fasting | no | no | no | no | yes | yes |
Water 2.2L bottles | 1 | 2 | 1 | 2 | 2 | 2 |
Vitamins | no | no | yes | yes | yes | yes |
Time bed yesterday | 03:00 | 02:00 | 02:30 | 10:30 | 11:00 | 11:00 |
Health review (for the past week)
- How would you describe your overall health?
- I think it’s probably related to not drinking enough water recently and eating too much stuff that I usually don’t eat that is making me feel so sluggish. Can’t wait for next week and I can start the new year all fresh. 2019 is going to be my year. The year I become a CPT.
- How do you feel?
- I feel happy because the weather is so nice today. I feel happy because of the people around me. The people that support me and stick with me through it all.
- How would you rate it (1–5)?
- 2.5
The Big Picture (daily)
- What happened yesterday?
- Yesterday we made a huge move up. Let’s have a look.
- So we started the day with a gap down below the Daily VWAP 2.0 SD and then basically traded the whole day up and reached the 1.0 SD
- We had a low of 42.603 and a high of 47.064 which means the market moved 446 ticks
- When we had the gap down, the 30M chart shows a lot of long wicked candles. And since they were at a bottom they looked like they were accumulation candles. PA was slow as well. I took note of this yesterday and today I see that we shot up hugely. So I am going to note of this for my playbook.
- What is the market sentiment?
- What does the crowd think?
- According to investing.com yesterday
- 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
- According to investing.com today
- All sentiments is 59% bullish
- Last week 54% bullish
- Last 3 days 54% bullish
- Not much has changed
- According to investing.com yesterday
- What does the crowd think?
- EURUSD
- High 1.14196
- Low 1.13443
- 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
- High 1279.30
- Low 1265
- 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 reported a build of 3.450M
- EIA report
- This report will come out on Friday but the forecast is a draw of ‑2.667M
- Geopolitics and the headlines of today?
- U.S. Oil Prices Rebound After Christmas Eve Meltdown
- Investing.com — Oil prices pushed higher on Wednesday, with the U.S. benchmark bouncing back after reaching its lowest level since June 2017 in a bruising pre-Christmas session on Monday.
- Energy Minister: OPEC+ Deal Has Brought Russia $120 Billion
- Russia’s budget has received an additional US$120 billion since Moscow’s cooperation deal with OPEC started two years ago, Russian Energy Minister Alexander Novak told local business daily Kommersant in a wide-ranging interview published on Tuesday.
- In a first, Trump makes surprise visit to U.S. troops in Iraq
- AL ASAD AIR BASE, Iraq (Reuters) — President Donald Trump made a surprise Christmas visit to U.S. troops in Iraq on Wednesday, his first trip to a conflict zone nearly two years into his presidency and days after announcing a pullout of American troops from neighboring Syria.
- China’s industrial profits suffer first annual drop in three years
- BEIJING (Reuters) — Earnings growth at China’s industrial firms in November fell for the first time in nearly three years in the face of slackening domestic and external demand, highlighting rising risks to the world’s second-largest economy.
- UN Partnership to Roll Out Blockchain-Based Telemedicine, Telepsychology in East Africa
- The United Nations Office on Drugs and Crime (UNODC) will reportedly partner with blockchain-based telemedicine and telepsychology firm doc.com to expand free basic healthcare services across Eastern Africa. News of the partnership was shared with Cointelegraph in an email on Dec. 26.
- Falling Oil Prices May Spark New Debt Crisis
- U.S. oil prices at below $50 and now even below $45 a barrel could cause concerns about the debt levels of some energy companies, Nasdaq energy analyst Tamar Essner told CNBC on Wednesday.
- “Credit markets have held up a lot better than the energy equity markets right now, so that tells you that credit investors out there believe in the oil story much more so than energy equity investors do right now,” Essner said.
- Asian Stocks Rise, Nikkei Jumps More Than 3.5% After Wall Street Rally
- Investing.com — Asian stocks rose in morning trade on Thursday, with Japan’s Nikkei 225 jumping more than 3.5% after Wall Street recovered from the steep losses suffered in the previous session and recorded the biggest rally since 2009.
- 2019 Will See Entry of More Institutional Players in Crypto, Says Asia Fintech PwC Leader
- India May Legalize Cryptos But Under ‘Strong’ Rules: Report
- Dow notches record point surge in dramatic rebound
- (Reuters) — The Dow Jones Industrial Average surged more than 1,000 points for the first time on Wednesday, leading a broad Wall Street rebound after a report that holiday sales were the strongest in years helped mollify concerns about the health of the economy.
- Exxon continues drilling offshore Guyana as Venezuela lodges complaint
- CARACAS (Reuters) — Exxon Mobil Corp (N:XOM) said on Wednesday its oil drilling and development activities offshore Guyana were unaffected by a weekend incident in which Venezuela’s navy stopped two exploration vessels the company had hired.
- Gold Prices Mark Fresh 6‑Month High on Safe Haven Demand
- Investing.com — Gold prices marked a fresh six-month high on Wednesday as recent risk-off sentiment drove investors towards the safe haven precious metal while U.S. President Donald Trump held fast in his insistence for border funding in order to reopen the government.
- U.S. Oil Prices Rebound After Christmas Eve Meltdown
- Additional OPEC news
- None at this moment
Intraday Technical Analysis
Wed | Thu | Fri | Week | Mon | Tue | Wed | |
12/19 | 12/20 | 12/21 | 12/17 — 12/21 | 12/24 | 12/25 | 12/26 | |
High | 48.369 | 47.543 | 46.816 | 52.145 | 46.287 | 0 | 47.064 |
Low | 46.338 | 45.718 | 45.179 | 45.179 | 44.169 | 0 | 42.603 |
Close | 47.423 | 46.243 | 45.439 | 45.439 | 44.363 | 0 | 46.675 |
Pip move | 203.1 | 182.5 | 163.7 | 696.6 | 211.8 | 0 | 446.1 |
PP | 47.377 | 46.501 | 45.811 | 47.588 | 44.94 | 0 | 45.447 |
distance | 103.9 | 78.3 | 63.2 | 240.9 | 77.1 | 0 | 284.4 |
R1 | 48.416 | 47.284 | 46.443 | 49.997 | 45.711 | 0 | 48.291 |
distance | 203.1 | 182.5 | 163.7 | 696.6 | 211.8 | 0 | 446.1 |
R2 | 49.408 | 48.326 | 47.448 | 54.554 | 47.058 | 0 | 49.908 |
distance | -99.2 | -104.2 | -100.5 | -455.7 | -134.7 | 0 | -161.7 |
S1 | 46.385 | 45.459 | 44.806 | 43.031 | 43.593 | 0 | 43.83 |
distance | -203.1 | -182.5 | -163.7 | -696.6 | -211.8 | 0 | -446.1 |
S2 | 45.346 | 44.676 | 44.174 | 40.622 | 42.822 | 0 | 40.986 |
TV | 72,350 | 80,893 | 72,030 | 351,797 | 42,179 | 79,278 | |
50MA | 58.766 | 58.273 | 57.775 | 57.212 | 56.705 | ||
200MA | 65.932 | 65.859 | 65.78 | 65.69 | 65.613 |
- What can we tell from the PP levels?
- We widened our PP levels more so than the whole of last week’s levels
- DPP is at 45.447 level now which is still lower than last week’s
- We had a good amount of TV which could be traders celebrating Christmas coming back to the market and taking positions.
- Where are the higher time frame S/R levels?
- We shot through the Daily level of 45.10 that is a possible support level
- With a weekly chart resistance level of 47.50
- What does the 4H and 30M chart show?
- On the 4H chart we can see that we blasted through the VWAP mean and halted at the 1.0 SD
- The 45.10 level is also around the same level as the VWAP mean so let’s see if this level can hold up
- The 2.0 SD is the same level as the 50MA and the weekly 47.50 so at this point we wouldn’t be able to have the momentum to BO here I think
- We could see the market pulling down the price a bit and enter a squeeze before we have the energy to BO and cross the 4H 50MA
- The 30M chart shows that we followed the 2.0 SD all the way up and then slowly rolled over and are now at the VWAP mean and might break this and enter the squeeze again before we make a bigger move
- I’d be interested if we could hold up the DPP 45.477 level which coincides with the 4H chart VWAP mean and weekly 45.10 level as well
- On the 4H chart we can see that we blasted through the VWAP mean and halted at the 1.0 SD
- How far away are we from technical levels?
S/R | kind | level | Distance |
R6 | WR1 | 49.997 | 379.7 |
R5 | Daily | 49.8 | 360 |
R4 | DR2 | 49.908 | 370.8 |
R3 | DR1 | 48.291 | 209.1 |
R2 | WPP | 47.588 | 138.8 |
R1 | Weekly | 47.5 | 130 |
CURRENT | 46.2 | ||
S1 | DPP | 45.447 | -75.3 |
S2 | Daily | 45.1 | -110 |
S3 | DS1 | 43.83 | -237 |
S4 | WS1 | 43.031 | -316.9 |
S5 | Weekly | 42.9 | -330 |
S6 | DS2 | 40.986 | -521.4 |
- What has the Asian Session printed?
- We can see that during the AS we moved lower in a pullback move back to the 30M VWAP mean
- And we entered the tightening part of the VWAP bands
- We can see that during the AS we moved lower in a pullback move back to the 30M VWAP mean
- ATR
- What is the ATR on the daily?
- Is it increasing/decreasing?
- 2.4905
- We’ve kind been trading around this level for the last 2 weeks
- What is the ATR on the daily?
Trade Plan
- I’d be looking for signs of weakness during the AS that could bring us down from the huge rally we had yesterday.
- And see where we can hold support. At this point I’d be looking to go long with a swing reversal trend termination setup which would be a higher time frame trend continuation move
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.
- On London open we were under the LKC and we had a few long wicked candles out of the 2.0 SD and then on the open we had a hammer candle forming on the 30M 200MA level just below the UKC and 10 ticks above the DPP 45.447 so I thought a swing reversal setup was forming and took my first trade
- T1
- Win 7 ticks conservative
- I covered when we kinda halted just below the LKC and i just wanted to pocket some gains from the get-go and I’m happy I did since price reversed and we are having some more long wicked candles at this point.
- Could this be another accumulation phase going on on the smaller time frame? Let’s wait and look for more clues. It could also be more distribution.
- So what do I see forming on the charts. What stars are aligning?
- I see that we ran interference by the 30M 200MA and we are in the tightening part of the VWAP on the 30M
- The 30M KC is in an uptrend
- PA is above the 200MA
- On the 5M we can see that we formed a cup of some sorts with long wicked candles right under the LKC
- VWAP is trending down and looks to be tightening where the KC looks to be expanding so a divergence is on the horizon
- We just re-entered the KC and hit the 1.0 SD
- The spread is 34/35
- It looks like PA is not following rules as much so be extra cautious
- VWAP is tightening on the 5M while the KC is widening however PA is still on the lower side of the KC just above the LKC
- I’ll be waiting for PA to go flat and then wait for a possible BO but let’s wait and see what will happen
- It looks like we might be going flat since PA could be trading in a range on the lower time frame
- We just dropped to the DPP 45.447 level let’s see if we can hold this level
- PA is below the 50MA and 200MA on the 5M and the 50 just BD from the 200MA
- We look like we are trying to break the DPP and are now at the 30M KC 50MA point so let’s see if this holds and we reverse
- This is also the 4H VWAP & LKC CAS level
- I’ll be looking for a long opportunity here but the 5M has to confirm this in the form of a bullish candle pattern but we look like we might have a continuation still
- The 5M shows a downtrend since PA is still far under the LKC so I should be looking for a short opportunity (unless I’m fading which I do like to do)
- But if I was looking for a short where would that be?
- Bearish candle at the 5M VWAP mean
- But if I was looking for a short where would that be?
- If there would be a reversal at this level how would that look like?
- A move away from the 2.0 SD and then a bullish candle
- We dropped to the Daily 45.10 level which means we already moved 110 ticks
- At this point I am more inclined to look for a trend continuation setup
- T2
- Win 12 ticks conservative
- T3
- Loss 27 ticks conservative
- T4
- Win 7 ticks moderate
- I am going to stop trading now but keep watching PA.
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?
- Swing Reversal
- On London open we were under the LKC and we had a few long wicked candles out of the 2.0 SD and then on the open we had a hammer candle forming on the 30M 200MA level just below the UKC and 10 ticks above the DPP 45.447
- I took a conservative position
- Swing Reversal
- SL
- Just below the wick of the hammer candle at 45.55
- TP
- 46.001
- I set it at the swing low where it touched the LKC before it ducked underneath it
- 46.001
- Trade Management
- I covered when we kinda halted just below the LKC and i just wanted to pocket some gains from the get-go and I’m happy I did since price reversed and we are having some more long wicked candles at this point.
- Win 7 ticks
- Why? What do I see?
- T2
- Why? What do I see?
- Swing Reversal
- PA crossed the 5MA after we slightly moved away from the 2.0 SD
- Also we were at the 30M MA level
- Entry
- 45.292
- Swing Reversal
- SL
- 45.040
- TP
- 46.269
- Trade Management
- I covered at 45.412 because we got near the LKC and VWAP mean
- Win 12 ticks
- Why? What do I see?
- T3
- Why? What do I see?
- Trend continuation
- We got back to the 8MA and thought I’d take a continuation position
- Entry
- 45.232
- Trend continuation
- SL
- 45.896
- TP
- 44.528
- Trade Management
- Covered at a loss at 45.504
- Loss 27 ticks
- Covered at a loss at 45.504
- Why? What do I see?
- T4
- Why? What do I see?
- Swing Reversal with continuation
- We dropped to Daily 45.10 level so thought we might have a reversal at this level
- 5M PA took a sharp turn up and crossed MAs and then crossed LKC and VWAP mean
- Entry
- 45.548
- Swing Reversal with continuation
- SL
- 45.003
- TP
- 46.330
- Trade Management
- Above anything else I am trying to learn to control my emotions while in a trade.
- PA seems to slowly creep up even though we are having doji candles at the top of the swing
- I covered when PA hit the 5M 50MA 30M 200MA level
- Covered at 45.613
- Win 7 ticks with moderate position
- Why? What do I see?
Trade Review
- Did you let your trade play out or did you cover or stop out sooner? If so, why?
- Still focussing on taking good trades
- T3 wasn’t a good trade though. I let it ride too long and should have cut my losses quick.
Daily Report Card
- Only take 4 trades
- I took exactly 4 trades and lost 1 tick but am up in money
- Only take PB setups
- This one I feel I didn’t do too well. I had taken a short and then returned and took a long when the short was still open. I should have cut the short there and then before going long.
- Because I broke my rule I am forcing myself down from Optimistic to Conservative in terms of my trading sizes for tomorrow. Let’s see if I can still close the week in profit. Right now I am down a little bit in money and I am down 6 ticks for the week.
Feedback?
Any questions or feedback you might have please feel free to leave a comment or contact me directly.
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