If there’s one thing I’ve learnt from these TT threads it’s to always plan the each-way options & cover the bases. That way, there’s less chance of getting blindsided.
I ticked my upside & downside play options during Tuesday & Wednesday. (I’m still being encouraged to e-mail my charts & plans to Mark prior to taking action, so it keeps me on my toes lol).
The move down towards .8800 played out while I was climbing into my bed, so I’d have to wait see if the pullback developed into the London business day.
It didn’t.
In fact it turned on it’s heels & made a run for the 850 resistance zone instead.
I let the first thrust go & took it on as a classic momentum pullback break through .8895 yesterday (London) afternoon.
It’s remained bid during their local session & I’m figuring the momentum shift might attract short range bargain hunters to check out those stops at 9000.
I’ve positioned my risk below the initial upthrust at .8860 with the obvious downside being a lack of appetite to run it ahead of the stress tests & weekend profit positioning.
If so, I got a clear playable fulcrum at .8850 to get stuck into.
Unfortunately I got to split & I’m not going to be around now until late next week, so I’ll stick this up & I think jj will be around later today if you got any follow up queries before the w/end.
One of the primary focuses of the template threads material concerns the identification & execution of bets as price gets worked on & around key levels.
One of those key levels, among others, is yesterdays high (or low).
Another key level is a round number or big figure.
If you can line up one or more key levels in sync with current bias or momentum, you have a pretty good reason to begin looking for a likely trigger to get you seated as long as you can compute acceptable risk with forward potential.
As price moved from New York into the Australasian shift, price was being worked around yesterdays high. Yesterdays high was also vibrating a [B]round number /B
It ticked through the entire Tokyo shift in a tight, shallow range. That dual zone of interest signified little in the way of offers or supply.
Therefore, if it was effortlessly holding a bid into the London opening ticks, the path of least resistance would lend me to start looking for a reason to either get long or add to any existing long bets, given the near-term bullish bias.
The initial tick up in activity as London came online was to print a higher low (1-2-3).
The momentum was quite visibly ticking higher on the back of the prior days activity.
That type of behavior would suggest that betting long would offer me potentially higher odds of a positive outcome than looking to bet from the short side.
The average days range then comes into play as a guide to likely exhaustion or potential reversal steps on the price ladder.
Throw a couple more logs on that Aussie fire & see if you can’t encourage it to go stop hunting catcher.
If the CPI numbers on Tues/Wed follow the lead of the PPI results, it’ll undoubtedly cool the interest rates fire for a while longer & could take the air out of the current inflated prices up underneath 90.
Any slip from here will need to find solid bids @ .8870-90 to into the CPI numbers. If you haven’t already pared out, you might want to consider wrapping a heat protection suit round your stops!
It looks nicely bid to me on this current re-visit.
There are obviously a few stress test skeptics (try saying that after a couple Millers) roaming around out there, but they look content to play the ‘risk’ card so far this morning.
I’d hang fire selling 113.25 today.
Morning jj.
I left everything where it was into the weeks close on Friday. I’ve stripped a little out up here at .8980 on the second push up this morning.
That means I can now leave my remaining stops back where they are & see if we get any follow through above & beyond .9000 this week.
Yen firming against the Dollar this morning is probably putting the brakes on the crosses upward momentum?
It’s not helping eur/jpy that’s for sure.
gbp/jpy is sucking in air on the back of Cables early pop, but that’s got it’s own agenda probing this aforementioned supply at the 55 handle.
If it can absorb the volume here it’ll get to see the color of those buy stops tiered above.
One or two brave souls might have taken it on at 5481 (the pullback break) if they got fresh underwear handy
[B][U]If in doubt, stay out[/U][/B]
How does that old saying go;
Better to be out wishing you were in, than in wishing you were out.
You’re not under any type of contract or governed by a commitment to leg into every available set-up/trigger combination that flicks up on the radar.
If you can’t readily identify a clear signal around a level or zone of significance, then let it go & cast your eyes over another pair, or wait for price to move through the level & check out the potential on the other side.
Price rarely pops up or down in a straight line.
If you miss the ideal value seat, or you don’t get a clear trigger to climb aboard, then as long as sufficient volume exists on the other side of a key zone, you’ll see it manifest itself by the behavior & reaction of the bars.
Stop clusters will include each-way orders. Price has to absorb the underweight orders & catch another wave on the back of the dominant order bias before continuing on it’s journey. That takes time to work through the books.
Part of that absorption reveals itself by momentum pullback steps.
Those can be traded via the trigger shown on here last week, [U]providing[/U] you got sufficient forward potential, which is measured by observing the percentage availability of the average days range.
As Jay confirmed, Cable remains bid. The slip back this morning attracted orders at the top of the Tokyo range.
I don’t see a 1-2-3 continuation on anything lower than a 60 second graph or a momentum pullback break around there as it pushed back up after 9.30.
So if those are your preferred trigger entry criteria, you’re on the sidelines for that mini leg.
That’s not the only short-range trigger on here though if my memory serves me right?!
Don’t forget that Carll contributed a cute little number not so long back, that plays a trigger running in sync with bias/momentum confirmed on the 5minute by a stochastic hook.
That will pick up the wiggles back to supply or demand steps (in line with dominant bias).
Put it up on a 5 minute graph & see what it displayed as price slipped back to check demand earlier at 5435 & 445.
As was advised, until you get a comfortable feel for the surroundings, behavior & style suitability of this type of gig, do your work on a sim or demo platform.
Basically it’s a win-win even if the offers overwhelm the buy orders on this leg & you have to scratch the trade at entry.
You’re still looking at approx 4:1 odds on an intraday bet to find out if the buy stops above 1.55 are there in sufficient numbers to run it up toward the average days range.
[QUOTE=crosshairs;208766]You’re still looking at approx 4:1 odds on an intraday bet to find out if the buy stops above 1.55 are there in sufficient numbers to run it up toward the average days range.
QUOTE]
Current average days range comes in at circa160 pips.
Todays low: 5410.
Pullback entry triggering at circa5450 + remaining average range coverage @ 120pips, holding a stop back at the last Tokyo higher low @ 5420 offers approx 4:1 before risk stops are moved up to neutral.
If you got a handle on the average range of your instrument, you can do the math pretty quick in your head on the hoof.
If you know the average days coverage is say 160pips & you got a current low and high for the day to key in off, then you can calculate the outer boundaries of the range as price moves back & forth between those levels.
So, like crosshairs said, he knows that the current range coverage for Cable is 160 pips.
He’s leaning towards trading long in line with the current flows on that pair.
He’s got a current daily low that has printed in Tokyo at 1.5410.
1.5410 + 160 = 1.5570.
He’s considering betting long on a pullback & he receives a signal from his trigger to place the bet around the 1.5450 level.
He places a technical stop back at 1.5420.
A quick mental calculation shows him that the 30 pip stop + 120 pips of potential upside from his entry, deals him a 4 to 1 shot.
If he was considering his entry at say 1.5470 & the only viable technical stop available was still back at 1.5420, that offers him potential odds of approx 2:1
50 pip stop & 100 pips worth of potential profit from the point of entry across a range of 160 pips.
Obviously you’ll know how your trade plan averages stack up across a typical model deployment.
So, you’ll know where your own personal odds of success are when trading from a precise style of set-up/trigger/risk/value criteria.
You can also work a mental running percentage play on those numbers as price moves between the current high & the current low of the day.
Remember this comment from last week?
65% of today’s range off the low of 1.5410 hits on 1.5524.
Current high for the day into early New York action hits on 1.5520.
Think that kind of info would be helpful when determining possible partial pare outs and/or price action based reversal signals?
5450 tickboxes last weeks high. Be nice to shoulder the profit taking at that zone huh?
The 5350 trailing stops have got the best seats from here for a pop at that upside channel back to 1st quarter rejection at 1.58.
Keep throwing those logs on that fire buddy boy & blow hard on the embers, it might just have enough steam to check out the next potential supply level.
