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To some extent it is nice that the US equity is maintaining an elevated level of volatility so that there are trades from both side. Otherwise, it would be back to the tiny daily range of last year, which is horrible for me as a day trader.
Can you help answer these questions from other members on NexusFi?
ES finally broke the one time framing to the down side.
The 30 min bar at the low has been nicely auction with a balanced profile.
This could be signaling the low of the day has already been in place.
Last Friday ES has taken out the Monday low and finally found support at prior week's Friday VPOC.
Friday's VPOC was successfully tested during the Globex session, we has seeing some bullish development after NY waking up to the new day.
If the price were to go higher, it would have to firstly stand firm above last Friday's VAH. The primal scenario for the day is still open test drive -- counter auction to the overnight inventory out of the open and then drive higher above the VAH.
The second scenario is the open drive and failure which ES failed either the VAH or last Thursday's VPOC and turned around aiming at taking out the Friday low.
On the tactical level, I would be gauging the probability of each scenario from the cumulative TICK of the first half hour of trading and then find setups in line with the directional bias from key TPO locations.
The TICK looks quite negative so far. The cum TICK is hovering around zero. I don't think it would be a full on bullish day. At least the TICK so far does not support it.
Three consecutive extreme negative readings in the TICK. It is possible that the concerted effort to run the stops of the overnight inventory has reached its peak, and we might have a TICK divergence at the low very soon.
Es has tested the prior VPOC twice this RTH session already.
With that level holding, the odds of a bullish day has risen substantially because the test part of the open-test-drive scenario has been completed.
Now the bulls have to show their strength by driving it through the prior day's VAH.
The NQ is the strength leader today and it is challenging the VAH at this moment.
Yesterday DAX was hit by a long liquidation in the morning which takes out the last Friday's low.
But the dip was bought into by some big funds. On the back of weak Euro, it has taken out the Friday's high on the other side which leaves us with a bullish engulfing bar on the daily.
The strength also lies in the fact that with the bullish price action, DAX has broken a 4 day long down trend line confirming that to be a bull flag.
It is possible some unknown buyer is suppressing DAX or some component stocks artificially low to build inventory.
Given this development, it is possible for DAX today to rip to the high closing the gap with CAC and EuStoxx50.
On the tactical level, the theme of the day should be buying the dips until the structure breaks. The primal scenario is a open-test-drive open type that I would expect DAX to test lower into yesterday's value before shooting higher. If DAX takes off from here without a pullback, then I just shrug my shoulder and let it be because it is not the market I am willing to chase from here.
There are several key levels that I am watching: VAH = 12570 VPOC = 12557.5
If it takes out the VAL at 12510, then I would reevaluate my long bias.
Good luck trading!