CL trading day Sept 7 2017 PM

posted in: Market Recap 0

The story of the day today is when too much time is too much.

Clearly there were not a lot of good trading opportunities. This was the oil inventory news day which is always the most difficult day to trade. The release was scheduled to come out at 11:00 AM EST.

In yesterday’s post I talked about yesterday balance extreme levels as being the first focus of the day. We opened near the low of the balance and the overnight inventory was short. I suspect that the short term day traders were long because of yesterday poor high after 5 consecutive up days. We traded only 1 tick below yesterday’s balance low and after the D period we were showing a prominent POC lowering the odds of a trend day.

The market could just not trade below yesterday’s low. Here is the lesson of the day. This is called spending too much time at a level.  In E and F we also traded at the low without breaking it. That makes 3 hours of trading without any breakout success !

When we spend too much time at a specific level the odds turn the other way and in this case favoring the buyers. Don’t forget that the added short inventory here at the low were on top of the overnight short inventory.

So Prominent POC  increased the odds of a rotating day and too much time at the low increased the odds of going higher. Obviously all this happening around the oil inventory news.  Not easy right ?

The only good buying opportunity came after the release ( in E ) in F period when we traded for the last time at the low.

The profit expectation should take into account the odds favoring a rotating day.

Trading is extremely difficult but understandable. Good trading !