2 Jan – Early selling reverses to break new highs
3 January 20194 Jan – Monster rally
4 January 2019Pre-open Scenarios
Yesterday saw a strong reversal from the cloisng gap left on 27 Dec and then continued gains, breaking the upper TL on the daily chart. ON the market has given back most of the gains as is trading around 10500 just prior to the futures open.
So the levels I’ll be looking at today will be 10387 which was yesterday’s low. A move below there will open up a run down to test 10253 and if that breaks, the next target will be 10,000. the Dax hasn’t been below 10,000 since July 2016.
The futures opened with a 92pt gap down and by the cash open the gap had widened to 104. So the question was, would the H1 down trend continue or would the market look to fill at least part of the 100pt gap?
What the market looked like at the end of the day
Early gains reversed and the market broke out of the Neutral Zone temporarily.
Key points about today’s PA and setups that worked
- The 169 was running through the middle of the PA which indicates ranging PA.
- The 3Min Bolli system works well in these conditions and three successful trades are easy to identify here.
- There was a classic pre-breakout PA at the lower edge of the Neutral Zone: it bounced off the level on the first hit, made a LH and then broke through.
- The breakout hit the BNR and reversed with 3Min Bolli setup.
- A similar pattern was seen when it broke back in: breaks up into the zone, reverses, sees an impulsive candle into the immediately bought up, makes a new high above the level and then continues up.
How effective was my Neutral Zone? Both longs and shorts worked inside the zone. The lower side of the zone was clearly the active level and it broke for 50pts.
How precise were my levels? None of my RES levels were in play but I traded off the TLs instead. SUP 1 saw a lot of orders and held for 30mins. I missed the BNR – that should have been SUP 2.
What I did
09:06 Sell x 92 @ 10492 | Fade 169 | P&L = -1R
09:10 Sell x 91 @ 10512| Fade 169 | P&L = +0.8R
09:21 Buy x 85 @ 10488 | Mistake| P&L = -0.2R
09:21 Sell x 84 @ 10483 | TL Break on M1 | P&L = -1R
09:27 Sell x 91 @ 10505 | Fade 169 | P&L = -1R
09:28 Buy x 81 @ 10516 | TL Break on M1 | P&L = -1R
09:31 Sell x 76 @ 10522 | Mistake | P&L = -1R
09:36 Sell x 74 @ 10521| 3Min Bolli | P&L = +1.6R
09:41 Buy x 89 @ 10514 | Fade 169| P&L = -1R
09:44 Buy x 80 @ 10506 | Fade an TL Break M1 | P&L = -1R
09:48 Sell x 87 @ 10510 | Fade 169 | P&L = +1.2R
10:15 Buy x 81 @ 10504| TL Break on M1 | P&L = +0.8R
10:20 Sell x 76 @ 10532 | 3Min Bolli | P&L = +2.8R
10:25 Buy x 92 @ 10516 | Fade 169 | P&L = -1R
10:33 Sell x 82 @ 10506| Tri/comp on M1 | P&L = +2.7R
TOTAL = 2.2R | # Trades 15 — Winners 6 — BE 0
Today’s most gorgeous setup
Using the 3Min Bolli when the 169 is running through the middle of the PA (see charts above).
For reference: 3 month cash chart at COB yesterday
