Trading Futures Journal: November 2008

Saturday, November 29, 2008

Filtered Time & Sales

I haven't use the filtered time and sales window in a while since I started using the 5 seconds chart and also because the time and sales window makes me overtrade. In the last 3 months I have been using very wide targets with nice results so I stopped using the TS, I thought I didnt need it anymore.

Today I wanted to do an exercise with the Time & Sale window (TS) taking advantage of the low volume day. I have been reading the filtered TS looking to confirm Magic tick and breakouts and I have to say that worked beautifully. My only consideration it is to do it only in key areas, otherwise I become a momentum player and finish scalping and overtrading.I spotted good examples of how to use it.

1) The bar at 10:51 (In my chart 7:51) which test the open didn't have any big players so I spotted that would bounce from support (Open price) and I use it to close my short. That was wicked.

2) As soon as the price broke over 884.25 R for 2 ticks at 10:59 (chart 7:59) , big players started selling so I shorted again. It would be a good scalp as it test again the open price but I wanted to see if it would break the lows of the day which it didn't.

3) Once the price touched the open price for 3rd time 11:03, I saw a big sale 1 tick under open price but inmediatly the big guys started buying, I knew my previous short would get stop out, but I gave it the opportunity instead of closing. That was the beggining of the rally up that will continue until the session was close. I have to say that again it was very clear.

4) 11:42 price breaks over pivot 887 for 1 point , and big sellers started droping the price to the support at the 884 level. Pretty cool.I am not sure how easy will be to read this in a high volume day, I am going to try some replays this weekend. Again this is something to be used in key areas, close to support/Resistance , Open range , open price etc. And the idea is to confirm Magic tick and break outs.

Thursday, November 27, 2008

Pivots on 100k

I have done a pass on the 100k looking for pivots (Support/Resistance) areas. They are more or less every 10 points. I will do a second pass on the 10k to refine them. We should be looking at this price levels how the price reacts. If it breaks and test -> entry. Target = At least the next pivot.

I am thinking to start with 2 contracts next week and set as first target next pivot +10 points , second target Lunch (I trade only half days).I have a theory to be confirmed of which ones are likely to reverse the price. Anyways, there is a behaviour very typical of a support/resistance area that you can see in any time frame. When the price has momentun is likely to look is breaking the pivot, but the truth is that this is either part of the momentun or stop loss (at any time frame). The important thing is that if the price goes back to the other side of the pivot, the second test as it has no momentun usually test the pivot perfectly to the tick, no kidding, and that marks what is likely a DT or DB and a nice confirmation of the reversal. Actually we can use that to identify the real pivot, we know there is overshooting or stop loss, but the second time it shows us the real pivot to the tick. There are lot of examples in the 100k chart I am posting.