Rhody Trader

Even though I missed yesterday’s oh so exciting day (right!), I still felt pretty good developing an expectation for today’s trading. Given the FOMC meeting and the Payrolls data this week, it was always likely to be a balancing day. And given that the open was going to be somewhere in the middle 1390s, it strongly favored a range contained by yesterday’s 1401 point of control and Friday’s 1388 one.

Now 1394 was Thursday’s point of control, which really also represented the top of a large joint value area down to 1386 shared by Thursday and Friday. That being the case, I knew it was pretty good odds that if 1394 was broken the market would continue down. So I shorted when that happened and grabbed a few points on the drop.

Once the market reached the lower end of the proscribed range, I saw a buying opportunity when downside momentum was clearly fading. Unfortunately, I got tricked out of the position by the internals and didn’t stick around long enough to grab the relatively easy points from

For a while there I was thinking it was going to be a losing day for me today, but the late rally turned that around and I went home a few points to the better. That’s always nice.

The price levels of interest included yesterday’s 1393 point of control, yesterday’s highs at 1399, and the single print point at 1385, which was essentially a rejection level on the rally up.

 

The market opened the day very close to that 1393 level, which suggested we could be seeing some further consolidation around that area. Things turned weak, though, pretty early. I was able to get a quick short in when I saw that things weren’t going so well, but ended up getting out for only a small gain when the market started showing signs of support in the upper 1380s.

Of course the market would later continue on lower. Not only did I miss out on additional gains from the short, but I’d actually gotten long when I saw some strength coming in. That position got stopped out for about a 4 point loss, and I was in the hole by a couple points for the session.

The market got stronger eventually, but it spent a lot of time in those upper 1380s not doing much of anything. Late in the day, however, I started to see some internal strength building again, and got long for another try. It was a real grind for some time, but once the market got through the 1393 level it shot up to make new highs. That was predictable since Thursday’s highs hadn’t been rejected.

Today was a fairly fun day.

Of course that’s always going to be the case where you can take a chunk out of the market. A lot of times day traders don’t catch the trend day type of moves like we got today, but I did just that today. The fact that I was short-term bullish on the basis of the market having basically done a gap fill and then creating higher value yesterday certainly helped.

The key levels for the day heading in were yesterday’s point of control at 1379, and Tuesday’s at 1375 on the downside and 1392, Friday’s point of control to the upside. The opening price in the low 1380s was a bit above yesterday’s point of control.

 

I actually got burned early on. When the market dipped down to the area of yesterday’s point of control and I started see some lack of follow-through I got long. Unfortunately, that was right before the 10:00 Housing data, which knocked me out on a four point stop.

I was able to get back in later when the market stalled out after making a new low below yesterdays. That, of course, was a great long entry point and I rode it all the way up to the area of Friday’s 1392 point of control. When the market started stalling out in that area I took my nearly 20 points and walked away. I could have gotten more perhaps, but not too much.

So basically I took a 1R loss early, then had about a 5R gain on the second trade. That’s a pretty good day by any standard.

Today provide a couple of decent trade entry points. The first was early in the day when the market ran through the point of control from Monday at 1386. The second was when the market reache down to yesterday’s point of control at 1375.

I didn’t get in on the short trade because I wasn’t seeing the market losing strength as I normally like to see (and I think I was on an earnings conference call for my job). I did, however, get in on the drop down later in the day and grab a couple of points on the bounce.

I didn’t post a trade loo-back yesterday because frankly the market was REALLY boring and I didn’t do anything. Today was a little bit better, though for a while in the pre-open it was looking like we might get stuck in the same range around 1385 again.

The open was a bit lower, though, so there was a fairly easy bracket of 1386 and 1372. That’s yesterday’s point of control and the top of the April 8-10 consolidation area respectively.

 

I go short at a bit above 1383 during D period after the opening balance had been established and I saw weakness as the market was near the upper end of its range. When it got down into the 1373 area I exited upon seeing the aforementioned weakness starting to abate. Because the market didn’t really demonstrate any strength building at the time, I didn’t go long, though certainly that did end up becoming a decent trade.

Today ended up being a rather predictable day. Yes, there was that big open higher. After that though, it settled down rather nicely into a playable range. The two main bracketing levels that contained prices today were the 1385 value area high from back on April 7th, and the 1400 level. The latter was more about being a round number with a little bit of longer term distribution significance tossed in.

My problem for the day was not thinking about 1385 as support at the start. I should have. It would have made for a nicely profitable day, no doubt. I did make a bit of profit on weakness in the afternoon, but hardly what I could have done.

I knew how to trade it today, but didn’t execute.

Actually, let me restate that. To start the day I had no idea what was going to happen. I really didn’t have a feel for up, down, or sideways. My approach was to take a wait and see to find out what kind of price distribution was going to develop.

 

As you can see, a general distribution day formed primarily between the top of yesterday’s main value area and the rejection points from the last time we were at these levels. I did identify that early on and bought at 1261 when the market moved back down there, but when there wasn’t a quick turn I bailed out for a small loss. Unfortunately, the market ended up rallying back up and I missed out.

Today we finally got some interesting stuff going on. The fact that the market was able to confirm the formerly rejected levels (A period) above 1336 in the afternoon yesterday gave a strong indication that today would see the market move higher. A little help from good earnings releases ensured that would happen.

The first meaningful level of the day was 1350, above which prices were rejected on Friday, and close to the 1352 lows from last Wednesday and Thursday. Above that, the 1356 level was last Wednesday’s point of control and 1364 Thursday’s.

 

I took a shot shorting against 1350 early on, as the run up in the pre-market could easily have been given back at least partially off the open. I put my stop at 1354 because if the market hit that it would clearly have shown more strength that was going to ever end up working in my favor. I did get stopped out, but on the basis of the expectation that the market would run up through last Wednesday’s/Thursday’s combined value area (basically 1353-1367) I went long. As you can see, things got a bit sticky around 1357, but late in the day the market broke free and did what I expected.

This was another predictably non-directional day. The market may have widened the range out a bit, but it still was held in the area constrained by those late March points of control. For all the back and forth, the central point was again in the low 1330s, just like it was on Monday.

Today was pretty much a nothing day. The market confined itself to trading more or less between the 1329 and 1336, which were points of control going back to late March. The pattern of a distribution day set up pretty early on, though, so one could easily have grabbed a few points