The transition to Futures trading

[Boggo]

Don't have time to post a chart but the FTSE weekly is really starting to get back up towards the highs. Perhaps a chance to establish a longer term position?

One option ?
(ZU Weekly - click to expand)

 

[CanOz]

My take is that 6550 should hold as that was the start of the last successful auction higher. However, if that fails then the bracket low of 6530 must hold to remain bullish in the short term, there could be some significant liquidation beyond that...

The last high at 6658 seems to be a "poor" high, without excess. These tend to get revisited.

either way, if we open between 6593 and 6571 we can expect a balanced day. Out side of this we may see some test of the areas mentioned above.

It is worthy to note that we've taken out a short term channel as well, but the fed induced rally has clouded things somewhat.



Edit: i had the CAC40 numbers in there as i was looking at the wrong VWAP chart, but the correct TPO, since changed them to the proper levels...

 

[kid hustlr]

Tech,

in this thread you talk about breakout set ups for stocks.

The below chart is 10 year bond futures but do you think this shape is one that would appeal to you as having potential to break to the upside? I note the big push up and the fact the retracement has only made it some 1/3 of the way back.



EDIT: or do you feel there is too much supply at the top of that range?

 

[tech/a]

Tech,

in this thread you talk about breakout set ups for stocks.

The below chart is 10 year bond futures but do you think this shape is one that would appeal to you as having potential to break to the upside? I note the big push up and the fact the retracement has only made it some 1/3 of the way back.

View attachment 54478

EDIT: or do you feel there is too much supply at the top of that range?

Would like more chart.
What is the time frame
What is the highest volume so I can relate it to the other bars.

 

[CanOz]

Well there goes 6530....

 

[kid hustlr]

Would like more chart.
What is the time frame
What is the highest volume so I can relate it to the other bars.

Timeframe for that chart is actually 400 minutes.

On a longer term basis we have been in a downtrend however this week is effectively the first week of this roll period. I'm less concerned about the 'background' so much as I'm interested as to whether this as a stand alone set up would be a possible breakout option.

Chart below is 15 minutes version. You can see that the volume has quietened down the last few days.

 

[kid hustlr]

Would like more chart.
What is the time frame
What is the highest volume so I can relate it to the other bars.

Tech, I'm still interested in your thoughts if you get an opportunity.

Just as a follow up, here's where its at now. It broke up this morning.

Tech, am I correct in saying that the major factors you consider is how far the pattern retraces from its high and the amount apparent supply near the initial high? In this case there appeared to be some supply but not an overly huge amount and the retracement was quite shallow with a nice bottoming pattern on limited volume, both signs of perhaps an opportunity to get long?

 

[tech/a]

Tech, I'm still interested in your thoughts if you get an opportunity.

Just as a follow up, here's where its at now. It broke up this morning.

Tech, am I correct in saying that the major factors you consider is how far the pattern retraces from its high and the amount apparent supply near the initial high? In this case there appeared to be some supply but not an overly huge amount and the retracement was quite shallow with a nice bottoming pattern on limited volume, both signs of perhaps an opportunity to get long?

View attachment 54485

Sorry really busy at the office--change of Govt!!

In answer (Briefly) Yes your correct in part.
I am particularly interested in how each test is carried out in any range.
The support and resistance Zones (Rather than a set pivot).
Im working on a method of calculation of volume for the length of each swing to then see if volume is accumulating or distributing within the pattern. This can be done in any timeframe.
We are trying to make the indicator dynamic so that we can see a sideways pattern and hopefully an indication in price and range which tells a different story.

Just haven't had the time to do it.
This is not a new theory but perhaps my use is a little different.
I have a book on the topic which Ill place up details for you here tonight.
Its a Rare book hope you can find it.
Took me a year!

 

[kid hustlr]

Sorry really busy at the office--change of Govt!!

In answer (Briefly) Yes your correct in part.
I am particularly interested in how each test is carried out in any range.
The support and resistance Zones (Rather than a set pivot).
Im working on a method of calculation of volume for the length of each swing to then see if volume is accumulating or distributing within the pattern. This can be done in any timeframe.
We are trying to make the indicator dynamic so that we can see a sideways pattern and hopefully an indication in price and range which tells a different story.

Just haven't had the time to do it.
This is not a new theory but perhaps my use is a little different.
I have a book on the topic which Ill place up details for you here tonight.
Its a Rare book hope you can find it.
Took me a year!

ty duckman!

 

[CanOz]

For Ninjatrader, there is a Priceactionswing indicator that will label the swings with volume if you like...

I cannot attach it here as Ninja indicators cannot be attached on ASF.

 

[CanOz]

These little auctions down on the FTSE have been much more intense than the auctions up...The bracket low has held for now....but for how much longer until we see the market auction towards 6400.

Oh, and yesterday was an inside day closing near the low... If we test current value at 6540 and find sellers I'll be looking for shorts...

 

[CanOz]

To add to my bearish view, which needs to be validated...

The fed induced "pop" up to 6660 seems to have been done on very low volume. How can we expect higher prices if there is no new buyers with the move?

You can see that value is being accepted lower on the weekly VWAP, Monthly, and even now the continuous VWAP has the market back in its value area.

Instead of looking for a break lower, i plan on selling the counter trend rally's.

Today could be a substantial trend day if open up outside of value, that would take a bearish day in Asia as a catalyst.

charts from top to bottom:

Continuous VWAP 60 minute
Monthly VWAP - 60m
Weekly VWAP - 60m
Channel Chart - 60m

Tech/A, i know you're busy but can add your top down analysis today? And Boggo as well? See if we can get some confluence...

 

[>Apocalypto<]

To add to my bearish view, which needs to be validated...

The fed induced "pop" up to 6660 seems to have been done on very low volume. How can we expect higher prices if there is no new buyers with the move?

You can see that value is being accepted lower on the weekly VWAP, Monthly, and even now the continuous VWAP has the market back in its value area.

Instead of looking for a break lower, i plan on selling the counter trend rally's.

Today could be a substantial trend day if open up outside of value, that would take a bearish day in Asia as a catalyst.

charts from top to bottom:

Continuous VWAP 60 minute
Monthly VWAP - 60m
Weekly VWAP - 60m
Channel Chart - 60m

Tech/A, i know you're busy but can add your top down analysis today? And Boggo as well? See if we can get some confluence...

bloody fancy charts you have there Can_Oz

 

[kid hustlr]

Y/d was the frist day in 7 that the cash close finished above the cash open. We also broke the intermediate trendline in the 60m chart so perhaps there is some bullishness yet. I favour a little bit of churn with perhaps some upwards bias until we then take another leg down.

I really like your analysis Can but I must say sometimes I struggle to understand your charts, there's so many squiggly lines on them its like looking at pixels analysis!

 

[tech/a]

Can

Really interesting analysis on those charts.
I can see why your looking for some opinion.
I would like to go into each chart fairly deeply but don't have time.

I'm seeing most of price trading above the VWAP.
Breakdowns seem to be short lived.
While resistance keeps being tested we must question --- accumulation or distribution at those levels.
Meaning Resistance of Price (Is that enough distribution for long term weakness) or is buying at VWAP support enough accumulation to expect longer term strength.

Supply governs price---in my view far more than demand.
If supply dries up then it is entirely possible for price to break through resistance
without the aid of higher volume.
In fact Bulkowski makes a strong case for high volume to be a hindrance in a push forward.

In GENERAL terms I agree.
But specifically if volume
(1) Gaps through resistance
(2) or Ploughs through resistance
then there is from what I've seen a much stronger case for sustainability.

I'm reading it as bullish within the range 6400-6600

 

[CanOz]

Y/d was the frist day in 7 that the cash close finished above the cash open. We also broke the intermediate trendline in the 60m chart so perhaps there is some bullishness yet. I favour a little bit of churn with perhaps some upwards bias until we then take another leg down.

I really like your analysis Can but I must say sometimes I struggle to understand your charts, there's so many squiggly lines on them its like looking at pixels analysis!

The VWAPs i use with Market Profile as they illustrate the change in value very graphically. Each of the charts has its own purpose with the ultimate goal of finding strong levels of confluence. When i comes to execution i only use a single session VWAP, the bid/ask balance and a momentum indicator for divergence.

This is a standard chart set for this style of analysis. I realise that its seems very busy and i hesitate to post them at times. If you have ever used a VWAP you would have seen how accurately they represent the market structure and can provide for great context and some very nice trading plays.

Generally, if we open within the value area, represented by the shaded area of the VWAP, we will have a balanced market unless we have a news event. You trade the extremes of yesterdays value area, until we get through the initial balance period, say 90 minutes from the futures open.

If the Initial Balance is very narrow then you can look for a break out of the range, where as a wide initial balance area after an open in balance is almost always a balanced day, like yesterday, see the chart.

I agree about the churn, but the inside day and the strong selling on declines, has me thinking we may see some volatility soon.

Who knows, just a heads up.

I only took the one trade yesterday and the trade of the day occurred before i got stopped out on the last contract. It was around the US open so i was hesitant to re-enter as i only usually trade the EU session.

 

[CanOz]

Really interesting analysis on those charts.
I can see why your looking for some opinion.

Always interested in the bigger picture and its not presented here very often, that's all...

I'm reading it as bullish within the range 6400-6600

I agree that seems to be the larger bracket. If we accept that the bracket high was tested, then we could see a test of the lower extremes of the bracket, being around 6400...

You can see from the composite profile on the right, that most of the business was done in the two zones. There is a substantial amount of inventory (positions) at the current area (6560-6520). another reason why i expect that if we move out of the this area we could see some strong short covering or long liquidation, either way.

Perhaps we test 6400 and then rally on to test the highs again....

Today, if we open in the 6558-6510 zone then i'll be looking for a test of yesterdays VWAP at 6540 for responsive sellers or initiative buyers. If we open outside of this range to the downside i'll be looking to sell a test of the Value area lows....

If we open outside the zone to the higher side then i'll look to buy the Value area highs...all depending on seeing responsive participants at those levels of course.

I am a little biased to the downside in the short term until the lower side of the bracket is tested...

Thanks for the replies, lets have some more longer term analysis before the open.

 

[tech/a]

Id like to do some E/W on a FTSE 100 Chart.
Longer term
Boggo should be able to get to this quicker than I with M/T predictor.
A/GET (my E/W software) will give a more expanded view.
Ill do that tonight.

 

[CanOz]

One more chart then i'll exit stage right...Here's a 240m channel chart....

Larger consolidation here...today is the day, break lower or reject and eventually break higher

 

[kid hustlr]

ta guys.

so Canoz I gather one of the best uses for this structure is to help you develop with whether we could be looking at a range day (I believe you call them brackets?) or a break out day. interesting