True Gap B Formation

Short In The Hole Day

"The Bounce"

Fire In The Hole

Short In The Hole?

7:10 - We are long here at 1337.25.  Last night's overnight low printed new lows and then powered higher to close near highs.  With the market being so oversold, and yesterday's afternoon long liquidation event, it's high odds higher I think today.  Nice A period excess too.

7:41 - Still no upwards action.  Price has stalled right at yesterday's afternoon liquidation zone.  So far pullbacks have been contained by the POC.  But that will probably change if the upwards movement does not begin soon.  The daily is in a down trend and "nothing has changed" where price is stalling here.  Having said that, if this trade does stop, I'll be very interested in going long the gap fill at.

8:05 - Blammo, the downside is here.  Just a couple of ticks away from gap fill.   Have to absolutely wait for gap fill.  I will want to see some sort of transitional structure to enter long here.  Although this big liquidation bar could just have taken out the range low stops and reverse.  Going to wait and see.

8:50 - Here is transitional low at gap fill.  And I do not know what to do.  I just do not like risk to reward on anything here.  It's starting to bounce so hindsight will probably show that I should have taken the transitional long.  Weird, I get the setup I was looking for and cannot pull the trigger.

10:00 - All up move attempts are thwarted at POC.  Two hour tight base now at range lows.  Upside down check mark pattern so far. Sediment is basically zero, so it's low odds that a breakdown from this coil will have much extension.  Any up move probably won't go far as well -- not unless this is pure short in the hole type of base.  And it could be. Probably my best trade idea will be to buy a minor low below yesterday's range lows.

11:20 - Here is the look down below range lows after the fed spike.  Not buying it.  I don't understand today's action, so I'm sitting.   That initial spike rejection to the very tick of the POC is ominous in my eye.

12:50 - 10 minutes before the cash close and it's just a grinder down.  This is a situation where I think shorts are getting short in the hole.  But the news flow from Europe is too risky right now.  I just have to be ready to take continuation long trades, should the market rally tomorrow.

Journal Summary:  Today was an excellent example of just how clear structure can be and how hard it can to tactically engage it with success.  Today it was clear from the start that balanced structure was in play, yet I made impatient trades not at range extremes.  I even took one mid-range continuation trade that was sheer nonsense given the structure in place. What a great day of opportunity and learning.  

7:10 - The spikes up and down in the overnight session were a lead into a tight chopping A period. So far B period is chop too. Inside range day of yesterday and overnight. With the daily in a downtrend, a look down below A period is probably in the cards, but A period was unable to get below yesterday's range lows and there is an excess spike tail in overnight session below yesterday's range... It's a high odds balanced day until proven otherwise, so we will be watching those range extremes from yesterday for reversal opportunities. If the initial balance tight balance continues to grow, the longer it balances, the greater the odds that yesterday's range will be extended. Inter-market thesmes are mixed. Bonds are totally flat and dollar has gapped up and euro has gapped down. SP sectors are mostly green to flat.
--Notice how you never said taking any trades mid-range or not at range extremes. If you just listened to yourself. 

7:25 - Starting to move up here. Is this the beginning of a move up? As we talked about yesterday "if they cannot get them down hard, it will go up". No unusual volume or TICK at this point.

7:35 - Tactically, it always makes sense to not chase any move when sediment is near zero and an inside range day. That tactic proved a good rule of thumb again today as the B period spike up was met with a C period open drive down response. Chop, chop. If these TICK extreme readings continue to produce price impulses up and down I'm going to try trading them for very small targets.

8:10 - Here is a tick LOD and we are at value area low. Long 1335.50 for a target +3. Stop -2. Quick stop as the tick extreme just brought in more strong tick pushes. Here are A period lows. Bonds, dollar spiking higher.
  --Mistake here was not fully embracing just how close range lows were. At the very least, a stop below range lows was necessary. Getting cute with a stop close to the main reference is just dumb. 

8:16 - Buying the minor low here at 1333.50. No other major index has participated in this range low look down. Balanced structure still in play. Stop 1 point below the lows.
--Ok, now this is a trade.  A minor low with balanced structure in place.  You just have to remember next time that a minor low triggers a target of the other end of the range.  You were ready to take a quick profit after your 1st loss mistake. 

 8:35 - Entry was perfect. Target +4 at 1337.50 which is the point of control. Stop to break even plus a tick. Target hit. Now I get to start second guessing myself for not targeting VAH. lol Of course right to VAH. After taking a loss on the 1st trade, it's always easy to get to conservative on a target.
--Yep, you want the points back so bad, you failed to frame the high odds destination. 

 8:45 - It's all settling in now. 1st trade was seriously stupid. Just above range extreme. Haven't I learned yet? If you do mess with a trade above the lows, it has to have a structural stop. Just do like what you did with the second trade. Wait for that peak low with 10,000 divergences.

10:45. A coil at highs here is tempting to go long at 1340.50. but It's a balancing day and E period was just a minor new range high. Any continuation higher will most likely be muted.
--This was an excellent summation of why taking a low odds continuation trade was dumb.  You forgot to remind yourself that is was an inside day with neutral extreme sediment and the HOD was below prior day's value area high as well.  If you were conscious of all these structural slap downs, you'd have not taken the trade at 10:04 for sure.  I'm just amazed at how easy it is to lose site of the big picture and just 

10:04 - Ok, we are going long the VWAP here and POC at 1338.75. Nasdaq really out performing today and given how well the market held range lows, it just feels like there are a lot of shorts trapped at bad prices. Let's put our limit off at 1344. and run a stop just below VAL at 1335 10:45 -

10:15 - Well, this is why I typically never buy mid range on a balanced day structure. Why? It's because you just open the trade up to all kinds of heat. My entry was instant red and so far my stop just below VAL has not been hit but seriously, how can it not get hit at this point? I'd move it down to underneath range lows, but triple bottoms are rare, and there will probably be some significant stop running of the lows.
--Yep, instant heat on a wrong entry.  Great job in sensing the winding up of the sellers. 

10:49: There was the stop. No continuation of the stop, in fact, it's a reversal bar. TICK is very weak, however, with all bodies below zero. We are long again at 1336. Target 1342. That last stop was just too tight given the bad trade mid-range trade location.

10: 57 - Reverse the trade 1333.50 short. Stop 1337 My last entry went instantly solid red and the daily trend must be too strong. The market should not even be down here testing range lows again.

11:00 is a make it or break it time and if it's going to break lower, now is the time.

11:03 - Looks like the triple bottom is going to hold. Reverse again. Long 1336 with a stop below the range lows at 1332.

11:08 - Reverse again. Short. Bounce utterly failed and it looks lower now. 1334.25 entry and 1338.25 stop.
--These last two trades were just "too jumpy".  I lost focus of the structural action and just got lost in price. Totally turned around.  

11:13 - Out. Stopping trading for today. On the wrong side of everything is this reversing experiment. End of day -12 points per contract.

11:41 - Short 1334.75. VWAP destroyed the up move of lows and now we are back at lows. This is the 4th test of the lows now and afternoon sell programs could crush this thing. But then again the ES is the only index at lows. Not even the XLF. IWM and NQ hugely diverged. VWAP 1337.50, so is POC. Stop just above there at 1338.50. I think it will be bizarre if the market bounces and breaks above the vwap at this point.
--Here I went short after stopping for the day.  I was not looking for a trade, which is where the really good ones come from.  A quadruple bottom?  I really liked my comments that "afternoon sell programs could crust this thing".  I really did think it "bizarre if the market bounces".  I had a strong sense of the future probabilities. 

12:09 - Breakdown.  Double distribution now in play.  Target 1225.75.  It will either continue lower, or bounce here at stop gun below the overnight lows.

12:20 - Target hit.  A shocking display of patience on my part.  Beat the odds with a fill a tick off of low print of the day.

Shorts At Bad Prices?

Another Excellent Look Down And Go