See link to a VIDEO at the bottom of this post. There is a micro lesson on price action before the raw footage of today's trade.
I had a very good read on the market today and executed it properly. The inside support zone was really tee-ed up for everybody on the prep. I hope some of you caught the long.
My entry was interesting. I did not do a complete blind bet on the price today. Instead, I used what I call an inside micro breakout entry.
I identified the first outside 610 tick bar off my perceived low and drew a line in the sand. My plan was: if the price moves 1 tick above this bar I am going long.
There was a buy stop resting 1 tick above the bar in case the price blasted out of that are. There was also more conventional micro breakout long at 9:43 AM EST USA.
It is worth noting that I trade a lot of inside and micro structure at my zones. This is because if I wait until I am sure of what is happening, it is too late.
I do not have any major complaints about today which is very rare. I will bring up that I anticipated this slow grind up all day ofter 1050.00 broke but did not hold for the whole run.
You have to take profits at some point but in the future I hope to get full volatility out of these. Today was quite able to be projected correctly.
I explain the grind up in the video and will put it in text for those of you who read at work.
Micro Lesson For Today:
After 1050.00 broke and the market did not pull back or thrust upward, there was a familiar grind.
This consist of deceivingly powerful upward action that resembles a slow freight train to me. You can often spot this by multiple very narrow range 610 tick bars that slowly grind up.
This is caused by retail traders shorting (fading) the market.
The concept is that most retail traders do not usually catch the inside zones like the one we caught today (MACD and computer software can not help you project real structure).
They miss the move to the long side and get frustrated so they start fading the market as it grinds up.
They are selling heavily so the market can not burst to new highs. Price is driving up though. As their buy stops (covering) get hit, it is actually providing liquidity for a continued run up.
This is what causes action like today. It is a self fulfilling prophecy. A grind up with no significant pullbacks.
How can you apply this lesson?
Do not fade trending markets. Reversals are great but you have to know where to look (IE- today's inside support).
If you are constantly re-acting to price action via indicators and systems, you will rarely have a true edge.
Remember that indicators, even if they are customized, only look like they work in hindsight because they are tools used to smooth out price action AFTER it occurs.
In summary, they work great until they do not and there is no context as to when they will work and when they will not.
CLICK HERE FOR TODAY'S LIVE TRADE FOOTAGE AND MIDDAY COMMENTARY W/ MICRO LESSON VIDEO
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