Most excellent, and your theory makes a lot of sense. I'm trying to absorb as much of this high-level thought process as I can. Any methods you use to determine these areas when a fast moving bar is not involved? Areas of prior congestion?

I'll go back through your charts and see if I can pick up more that way as well. Thanks @JMP3!

Rrrracer 

Most excellent, and your theory makes a lot of sense. I'm trying to absorb as much of this high-level thought process as I can. Any methods you use to determine these areas when a fast moving bar is not involved? Areas of prior congestion? I'll go back through your charts and see if I can pick up more that way as well. Thanks @JMP3!

Shane, I'm headed out for lunch but I'll give you a quick answer. If there is an area where price has been congested for a while then you see a sudden drop, not just a 1 bar drop but 2 or 3 bars, then when price returns this would be what I consider a great supply area. I'll find an example chart when I get back, JP.

One Important item to notice is the NYSE Tick at 2:46 pm EST. The tick showed an overbought level at approx the 700. Knowing that there is a strong likelihood that price will usually reversal somewhat at the 127% fib extension and that the NYSE Tick was overbought, the logical conclusion for me was to exit my trade with plus 30 ticks.

Rrrracer 

Most excellent, and your theory makes a lot of sense. I'm trying to absorb as much of this high-level thought process as I can. Any methods you use to determine these areas when a fast moving bar is not involved? Areas of prior congestion? I'll go back through your charts and see if I can pick up more that way as well. Thanks @JMP3!

I went over all your old charts and have a pretty good feel for what you're looking at. I've pretty much been doing the same sort of thing, just highlighting the congestion areas and noting that's where price got hung up, but I have yet to gain a firm understanding of the underlying forces behind them. Your explanation has given me new insight, much thanks!

I suppose that's the sort of thing that you pick up after doing it for 10 years Since you have no trading plan on paper (I'm in that club LOL) I would imagine you have a high degree of confidence in your intuition. This is ultimately what I'm trying to build; mine has served me well in just about all other aspects of life and I feel it has to be an integral part of my trading.

Rrrracer 

I went over all your old charts and have a pretty good feel for what you're looking at. I've pretty much been doing the same sort of thing, just highlighting the congestion areas and noting that's where price got hung up, but I have yet to gain a firm understanding of the underlying forces behind them. Your explanation has given me new insight, much thanks! I suppose that's the sort of thing that you pick up after doing it for 10 years Since you have no trading plan on paper (I'm in that club LOL) I would imagine you have a high degree of confidence in your intuition. This is ultimately what I'm trying to build; mine has served me well in just about all other aspects of life and I feel it has to be an integral part of my trading.

I would imagine being a professional racer you already have a natural intuition. With trading it does not come overnight. So it does take time to hone in on your trading intuition. Having forums like this helps speed up the process.

I've spent the last 10 years trading futures as a part time fun hobby. Before that I was trading QCOM and Applied Micro Circuit as a young kid. I did not have a computer to trade with, I had to send in my entries to my broker via Smoke Signals

Because of the selloff in the YM the Hidden Divergence Power Play for a long trade was taken as a scalp. In a market like this Price can turn on a dime, 20 Ticks for today, JP.


Edit... There are 4 types of Divergence. When I get a chance I'll give all 4 examples on a chart, JP.