CL trading day 8 Sept 2017 PM

posted in: Market Recap 0

2-Day balance breakout.

 

Yesterday I mentioned that I would be focusing on the 2-Day balance extremes.

Balance trading rules ( balance low ) are :

  • Scenario 1 Market go down near the balance low and reverse. Target balance high.
  • Scenario 2 Market go down to the balance low , trade below it and re-enter the range. Target balance high.
  • Scenario 3 Market go down to the balance low , and breakout.

Balance trading rules ( balance high ) are :

  • Scenario 1 Market go up near the balance high and reverse. Target balance low.
    Scenario 2 Market go up to the balance high , trade above it and re-enter the range. Target balance low.
    Scenario 3 Market go up to the balance high , and breakout.

I also mentioned that the market could be “too long” after 5 consecutive up days and the poor high left Wednesday.

The balance low was extremely weak because of the poor and weak low left yesterday.

Overnight inventory was short this morning at the open. The market traded immediately down and was quite indecisive with very low conviction. The weak hands pushed the market down to the balance low and that was the critical moment.

When we traded at the low  – the market was exhibiting a one time framing down condition.

If you missed the short on this balance breakout you surely had no reasons to look for a buy :.

  1. One time framing down condition
  2. That was such a weak low  ( weak and poor low ).

 

Once we broke the balance low the market just traded on way DOWN…

In just today we took out all gains from the previous 3 days, we filled the gap that was created on September 5 and we re-entered the previous daily balance.

They just cleaned weak long inventories accumulated in the past 3 days and yes the short term inventory is now getting short.

 

 

 

 

 

Good trading !