3 Jun: Dips down to 200MA and then gains 180pts
3 June 2019
5 Jun: Speedy zig-zags between weekly and monthly pivots
5 June 2019
Pre-open scenarios
Yesterday we saw the buy from the 200 MA and the market gained 180pts to reach a high of just under 11800, and the cash session closed on the highs. Since then, it has sold off and retested 11704 ON.
So what will unfold today? As shown in the charts below, there is a possible new downtrend forming. But the market has some very significant support to get through before it could make the move: there’s the 200 MA at 11617 and the 61.8 fib of the bullish move since in 2019 at 11646. Therefore, a strong bounce off either of these levels is possible, as is a break through them. A break through 11617 could trigger a strong trending move down.
Daily cash 1-month and 3-month charts
Futures open
Futures opened at 11742
- A gap of -51pts against the cash close and -40 against the futures close.
- The futures open was within yesterday’s range, so there are no ex-gaps.
H4 and H1 charts just prior to cash open
Time stamp: 8:45 CET
Best fit, if there is one, is highlighted in red at the end of the day.
Scenario 1: breaks out of triangle early on and bounces from 11700 to retest yesterday’s highs – this was the closest but the low was 711, and it exceeded highs by 190 ptsScenario 2: breaks out of triangle early on and breaks through 700 to retest and then maybe break 11617Scenario 3: collects the orders at 11678 area and then ranges all day
What would be today’s easiest trade(s) if they set up?
- Buy at 200 MA
- Buy 11700 with CBOS below at 798
- Sell gap close
After the cash close
End of day H4 and H1 charts
Intraday M5 chart
Core trading hours PA M1 (9am to 11am)
Key points about today's PA and setups that worked
The market made a false break below the H1 open and then trended up all day
- The first move was the break down through the lower side of the H1 triangle
- Sellers couldn’t push prices down to the BNR or CBOS and bounce strongly from 11711
- As fits the definition of a strongly trending market, there were very shallow pull-backs at each KL
- The break above 11750 and the cash chart weekly 50MA was a reverse triangle breakout trade, created by the false break down at the open
- 3Min Bollis failed today but J-Los, H-C-Bs and Imp/Corr structures won the day
- The high was just above the daily cash chart 50MA
- All gaps are now filled apart from the 28 May closing gap at 12007
How effective was my Neutral Zone?
Each day, I would define a neutral zone within which, PA could be deemed directionless.
The market came within 3pts of the lower boundary and the upper boundary saw only a very shallow pull-back – the H4 TL was a better level.
How precise were my levels?
SUP 1 was just 3pts below the LOD; RES 1 didn’t see much of a pull-back but did present an Imp/Corr structure, RES 2 had no impact on the market and the market added another 140pts after punching straight through it and RES 3 should have been R2 rather than the unfilled gap.
What I did
TOTAL = -0.5R | # Trades 7 | Winners 1 | BE 1
Average R per winner = 4 | Losses > 1R = 0 | Scratched = 1
R-multiples: trades 2:1 or more = 1 | trades 5:1or more = 1
Outcome using standard TP strategy and same trades
2:1 trades (1R) + 5:1 +1xR
ON TILT trades = 3 (-2.4R)
Scratched trades = 1 (variance vs. rules =+0.6R)
Average HRV =N/a
Today's most gorgeous setup
This was a Hits-Corrects-Breaks for a break of the H4 TL and the weekly cash chart 50 MA. This was a textbook setup with the market overshooting the level buy a few points and then pulling back to test the 76.4% of the intra-day. This was a 22R trade
For reference: 6 month cash chart at COB yesterday
