20210916 Trade Review DAX

Play: Sus­tained Auction

#fin­twit #order­flow #day­trad­ing #trad­in­gre­view #price­ac­tion #chartre­view #DAX #DE30 #DE30Cash

Mar­ket Narrative

There was a D1 Inside Bar fol­lowed by a long-legged doji with impli­ca­tions for either a D1 DBD or a poten­tial Morn­ing Star. Price opened at H4 demand and closed as a pin­bar in pre­mar­ket indi­ca­tion a poten­tial for down­side but it was right at W1 demand. Equi­ties being equi­ties the upside is more preferred. 

There was a mod­er­ate imbal­ance at the open 0.19xASR below val­ue, with­in range. IB accept­ed val­ue and rotat­ed through fur­ther indi­cat­ing price want­i­ng to trade high­er. With H4 sup­ply at VAH I expect­ed some pull­back first before con­tin­u­ing in a pos­si­ble slow sus­tained auc­tion up. 

What hypo was it?

Hypo 2

Sus­tained Auc­tion Up after Val­ue rotation 

This was okay. 

How was the Entry?

DAX often likes to reverse or con­tin­ue in the intend­ed direc­tion in the lat­er half of the ses­sion. So when I saw price pulling back to with­in IB (after hav­ing extend­ed above IB slight­ly dur­ing D) I wait­ed for some kind of PA con­fir­ma­tion. There was a M5 Three Inside Up ‘reject­ing’ IB low fol­lowed by a M5 Bull Engulf. 

H4 was devel­op­ing an Evening Star to which the fur­ther impli­ca­tion would be more upside (at least momen­tar­i­ly to hope­ful­ly reach my target). 

How was the SL place­ment and sizing?

I used a stan­dard sized SL as I have been get­ting stopped out a few times even scal­ing the SL by a few pips. M5 being M5 there is usu­al­ly some wig­gling around before mak­ing a move. I set the trade and left. 

How was the prof­it target?

The expec­ta­tion was for a sus­tained auc­tion up (albeit pos­si­bly slow) with an entry off a pull­back with­in IB 2R should’ve been okay I gathered. 

This expec­ta­tion was negat­ed due to the exten­sion to the oppo­site side and change in approach of OODA and expec­ta­tions would’ve been valid. 

How was the Exit?

SL got tak­en out as per my cur­rent rules. This hap­pened after price missed the 2R tar­get by 2–3 pips before revers­ing. Nor­mal­ly, if I would be sit­ting at my desk I would have tak­en 1.9R but since I am not allowed to take any ear­ly exits I fig­ured I just leave and attend to oth­er mat­ters. Also prac­tic­ing with being okay with com­mit­ting to a trade and see what it does. Hey, I’m still alive!

In this case if I had used a slight­ly tighter stop, price would’ve hit my tar­get. Due to a LTF entry I thought stan­dard size was good due to the afore­men­tioned wig­gling before mak­ing a move. 

Anoth­er fact to note is that if I was active­ly observ­ing this, the exten­sion below IB would’ve negat­ed my sus­tained auc­tion the­sis and I’d have to change my expec­ta­tions. I wasn’t at my desk so I just let the trade do its thing (as well as not being allowed to change the trade). Price reversed and took out my stop ‑1R.

What would a price action-based exit have done for the trade?

If I would’ve tak­en the exten­sion to the oppos­ing side this would’ve been a ‑0.7R loss. How­ev­er since D TPO already extend­ed to the upside the more plau­si­ble rea­son­ing would’ve been a move up due to the Neu­tral Day impli­ca­tions. Per­haps some ear­ly prof­it-tak­ing around IB high (1.3R) would’ve been war­rant­ed. Sole­ly on price action it would’ve been about the same through a M15 Three Out­side Down (although some­what weak).

What would a time-based exit have done for the trade?

0.2R at nor­mal cut-off, 0.6R at over­lap cut off, ‑1R end of day cut off.

What did I do well?

I thought I did well although I am con­sid­er­ing that the price hav­ing rotat­ed through val­ue impli­ca­tions a bit more and will dis­cuss this with my men­tor for fur­thers notes on this. If val­ue had been accept­ed but not rotat­ed through this play could’ve been a more valid play perhaps. 

What could I have done better?

I think I did well on this. Also, the set­ting and walk­ing away part. I went to a meet­ing and did well not to think about the trade too much. 

Obser­va­tions

N.A.

Missed Oppor­tu­ni­ty

Pos­si­bly the Failed Auc­tion after D TPO extend­ed above at H4 sup­ply. Although this was at VAH after a rota­tion. Plus not much of a sell­ing tail. And val­ue had been rotat­ed through.

TAGS: Mod­er­ate Imbal­ance, below val­ue, with­in range,

Pre­mar­ket prep on the day

20210916 Pre­mar­ket Prep DAX

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