20210908 Trade Review DAX - Bear Market Trader
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20210908 Trade Review DAX

20210908 Trade Review DAX

Play: Failed Auction

#fin­twit #order­flow #day­trad­ing #trad­in­gre­view #price­ac­tion #chartre­view #DAX #DE30 #DE30Cash

Mar­ket Narrative

Pre­vi­ous day was a D1 Bear­ish Inside Bar. Lon­don opened 0.83xASR Below Val­ue, Out­side Range. IBR tra­versed down 1.56xASR. When Lon­don opened on a large imbal­ance price saw a con­tin­u­a­tion to the H4 Phase 4 and Asia Bear Engulf dur­ing IB. The wide IBR indi­cat­ed a high­er poten­tial for  respon­sive activ­i­ty in for exam­ple a Failed Auc­tion. IB also trad­ed into W1 Demand after tak­ing out D1 demand and exhaust­ing ADR.

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What hypo was it?

Hypo 2

Failed Auc­tion Long

Due to the Huge IBR this was the most pre­ferred play but as strength from with­in IBR was pos­si­ble as well I had put that as Hypo 1. It was the most prefer­able since it is much clear­er when price probes out­side of IBR and then failed to find busi­ness out­side of it for a sus­tained auc­tion. Much clearer. 

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How was the Entry?

Entry was good. I used a M5 Bull Engulf as my guide and wait­ed for M15 to close bull­ish which came as a Three Out­side Up. Then entered on a slight pull­back. I then let the trade devel­op and wait­ed for a tran­si­tion to M30 Bull Engulf offi­cial­ly fail­ing the auc­tion which came by the close of E TPO. 

How was the SL place­ment and sizing?

SL place­ment was slight­ly big­ger than stan­dard SL size but with­in the mar­gins of 10–11%. I use FX syn­er­gy with stan­dard SL siz­ing and pick the near­est one to the one I need. In the end this kind of helped me I think because price retraced miss­ing my SL by a few pips before mov­ing higher. 

How was the prof­it target?

Due to the Wide IBR I was some­what wor­ried if 2R was pos­si­ble. The wide IBR indi­cates respon­sive activ­i­ty and as such a slight­ly quick­er prof­it can be tak­en. Although due to the strict rules I am under I had no choice to see if my 2R tar­get would get hit. And oh boy did it get hit and then some. Trade even­tu­al­ly made it to 4.2R before revers­ing in line with Hypo 3. 

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How was the Exit?

2R tar­get reached

What would a price action-based exit have done for the trade?

Tech­ni­cal­ly the M15 Bear Engulf could have thrown me out for ‑0.6R but under­stand­ing that the nar­ra­tive was still valid would’ve over­ruled the ear­ly exit.

What would a time-based exit have done for the trade?

3.4R at Nor­mal Cut-off. 3.6 at Over­lap Noise Cut-off. ‑1 at end of day which wouldn’t have been as tar­get was already hit. 

What did I do well?

I did well to under­stand the nar­ra­tive and fil­ter out the noise of a devel­op­ing D1 Three Inside Down Nar­ra­tive which ensued lat­er on. I did well to under­stand that because of that nar­ra­tive my hypo 3 weak­ness from with­in IBR was high­ly prob­a­ble as well. Then I did well to take the trade and not touch it until price reached my target. 

What could I have done better?

I did well on this trade. Can’t think of some­thing I could’ve done bet­ter. Maybe I could’ve got­ten a bet­ter entry wait­ing for a test of M5 demand before enter­ing as the first M5 bull engulf after a big drop is rarely the imme­di­ate pre­cur­sor to a rever­sal. Usu­al­ly there is 2 or 3 before the actu­al rever­sal comes around. Ah well. I iden­ti­fied the rever­sal zone and found an okay risk/reward oppor­tu­ni­ty and that’s that. 


Based on the time­frame there can be two (or more) con­tra­dict­ing nar­ra­tives play­ing out. This is key to under­stand. A move high­er on a low­er time­frame can just mere­ly be a pull­back on a high­er time­frame. It is up to you to iden­ti­fy and synch up with that. This all comes with screen time my friend. That and Process, Patience, Persistence. 

Missed Oppor­tu­ni­ty

Weak­ness from IBR accord­ing to Hypo 3. In the over­lap noise price reversed and I could’ve tak­en that trade but I wasn’t at home when it happened. 

TAGS: Below Val­ue, Out­side Range, Large Imbal­ance, Wide IBR, ADR exhaus­tion, Trend is UP 2/3, 

Pre­mar­ket prep on the day

Dai­ly Report Card on the day


Day trader. Tech geek. Sim Racing Enthusiast.

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