Market Homework

[CanOz]

DAX homework for today.

With Asian down over 2% and the US futs down nearly .5% before the open in Europe, we could expect a GAP down to 6600. If this happens we have the previous value area above that could be tested, and perhaps a GAP fill. We'll look to fade that move if it takes place after the London open when we see how the market reacts to the test and perhaps try to stay in for a move much lower today. If this does not play out we will wait and look for where the initial balance forms and then decide if we would range trade or look for the clues of another trend day later on.

The chart shows are significant areas of support and resistance today, where we will look for trading opportunities as the market direction becomes a little clearer. There are also a couple of areas of support to be tested below 6560...
No news until later this evening.

Cheers,


CanOz

 

[CanOz]

The DAX opened at the lowest target area and bracketed in choppy action until finally breaking down. I got in on a fade of 6500, and stole a few points, I gave back half later though then went to NT SIM to continue taking trades on my trade lines. I think that will eventually become part of a more active trading plan as well. For now I want to prove to myself that i can be profitable and not over trade. That's why I use the IB paper trade account, I cannot reset it easily so all my trades that count are recorded there. I can still move on the NT sim later to practice entries on my trade lines.

I will post my homework here, and the days trades on the One Good Trade thread.

CanOz

 

[CanOz]

Today's levels on the Asian markets. Looking to fade 237, or if that breaks then we'll try a pull back to it. Expecting a little bounce today, so we could see a topside range extension. If that happens then we'll try and catch pullbacks.

 

[CanOz]

The HSI needed a little cleaning up...

 

[CanOz]

A bit late getting this posted....DAX levels today. We've got a bearish slant still and if the value area continues to develop lower than yesterdays then we can expect and range extension to the downside to test yesterdays low of 6370, after a test of 6400. If we can test that and hold, and then hold 6400 on the way back up then we could see a bounce into 6470 or so before the US open. With some data out, we'll see how the market reacts to the data and to these areas. At the time of writing the market has tested 6490 several times.

CanOz

 

[CanOz]

We're about due for a balanced day...K200 has support at 234.50 with two value areas above. We could have a range day today without allot of data.

CanOz

 

[CanOz]

Thinking we may get a move back towards 6410, if so we'll look to buy pullbacks on the way. If the continuation after a GAP fill fails, then we'll look to sell into 6350. 6315, prior low is an opp for a fade back to 6340.

Cheers,


CanOz

 

[CanOz]

Well the DAX wasted no time bolting back towards value at 6400 - 6410. As soon as London opened it took off like a rocket. The market had established two prior value areas from 6380 to 6435 so this was a strong area where participants agreed on value the most. It makes sense that the markets first move was to test this area again, unfortunate however, that it was without my position...

 

[CanOz]

Above 18900 we could see a run back into 19000. Below 18850 and into 18725 we can expect some choppy action until we move further below...looking for a choppy day in the value areas again...Below the value areas we'll fades the moves lower, back into the value areas. Above 18900, we'll try and pick a pullback to jump on that move...

 

[ThingyMajiggy]

Wow those charts are looking mighty complicated

 

[CanOz]

Wow those charts are looking mighty complicated

I could take off the volume profile Sam, and then you would just have the levels to watch, which is what i do. Its how i get to those levels that the VP comes in handy. Then I'm onto the DOM and the volume ladder to for trade decisions.

If you ever wondered why an area was really choppy, have a look at the past volume in that area...

CanOz

 

[CanOz]

Here's a couple of DAX charts. One showing the actual value areas (3) that have formed over the last three days, and one showing today's levels. I really expect another time frame player to enter today and we should see a trend day as its been three sessions in this same value area. Given the yesterdays higher test and rejection, and the fact that the value areas are getting lower gradually i favor the downside for the moment. A move above 6480 would see me favoring a bigger bounce into 6600 where there is a large value area. So given this, we'll look to fade moves away from the main current value area between 6440 and 6390. If we see enough strength to carry us towards a test of 6600 then we'll try and buy pullbacks.

I don't see any dramatic downside impulse, perhaps a test lower, absent any news. We opened right on the current POC. So we're neutral for the opening.

Cheers,


CanOz

 

[CanOz]

I thought i would post this interesting setup. The market retested a level and failed and then proceeded to go much lower. One could have been fooled into fading this, buy closer inspection reveals iceberg orders absorbing all the buying, while continuing to sell it down. There were also large orders on the Bid (not shown), trying to spoof the market higher into the icebergs.....cool

 

[CanOz]

Overall this week hasn't been too bad. The DAX is my best market. Last night after my NT lock up, i went a little crazy making up for my loss. Impossible to do if i was live...

Otherwise, if i stick to the plan, stay out of the value areas and trade the outlying moves, i seem to be able to do quite well.

In addition to this I've picked up a few things along the way...

Cheers,


CanOz

 

[CanOz]

Interesting open today. If the HSI open in the Rectangle, its going to need to pick a friend quickly. There is a value area above, and one below. Personally I'm thinking it will open near the lower value area anyway, but if it doesn't there could be a swift rejection of prices in between where the market has previously determined to be the agreed area of value...we shall see...

We will wait for an initial balance to form and then play the counter trend opportunities back to value, while keeping an eye out for a test higher. I cannot see how higher prices can be maintained on the basis of a few comments by the ECB leader...

Anyway, ours in not to judge, only to go with the flow....the order flow that is...

Cheers,


CanOz

 

[CanOz]

With weak Value areas overhead, its conceivable to see a trust higher to 6750. However, we could just fill a previous GAP at 6320. I would anticipate an open close to yesterdays close where we should establish an initial balance before the London open. From there we could test high and low for participants. This could set us up for a range trade day...

Cheers,


CanOz

 

[richardgary]

blog is awesome.. please do share some information market strategies for dividend stock.

 

[CanOz]

Levels to watch today. Lots of data trouble recently led me to end of revamping my charts.

Cheers,


CanOz

 

[CanOz]

Today could be a very big day if the high is tested and broken...

 

[CanOz]

Looking for a slight GAP down...if we open on an LVN we'll look for a drive back to value.