Trade Plan: Wednesday, August 16th, 2023

And we’re back

Hi all! Back with another trade plan. I took a few days off after the frustrations at the end of last week, and it was anyway a holiday where I live (Austria). Let’s review the two sessions I missed and make a plan for today! I’ll be trading in the simulator today, as punishment for some of my poor decisions last week. There are also some things I’d like to change / check about my process.

Timeframe Overview

Monthly OTF: down; ends 4635

Weekly OTF: down; ends 4544.75

Daily OTF: down; ends 4518

Value Overview

Monthly value: above, VPOC 4604.25 (July) VPOC 4485 (August)

Weekly value: above, VPOC 4492

Tuesday’s value: above, VPOC 4465, TPOC 4467

Monday & Tuesday Session Recap

Monday was a classic trend up day, with A, B, and C periods increasingly postive. For the remainder of the day, the IB high was defended nicely — exactly what you would like to see on trend days up, and providing nice opportunities for longs if you missed or otherwise couldn’t find good entries in the morning rally. M period’s rally brought us comfortably above the 4500 area, an area we’ve been watching for a while.

However, in the ON session Tuesday, sellers in the European session brought us down to that 4487 level for the US cash open. ES opened for the cash session at 4487.25, within the previous day’s trading range. With an initial attempt to overcome the local swing highs in the ON session around 4492, buyers ultimately failed and this led to a liquidation to 4458. This was a nice long setup that we would have taken in C period: a look below the IB low which has been defended multiple times over the past few weeks. This long would have payed nearly 20 periods MFE until F period, where sellers defended both the session VWAP and IB midpoint. In I and J period the IB low was defended again, but this reversion was only 10 points. in L period, the IB low was broken with conviction, leading to a liquidation to 4447. ES closed for the cash session at 4454. Overall, this day classified as an AMT trend day, bias of course to the downside. It’s interesting to note that we had a trend up day followed by a trend down day. The probability of this occuring is a data point we’ll be adding to AMT GPT, our superintelligence for answering any and all your questions AMT for ES and NQ.

I have now daily, weekly, and monthly OTF as down, suggesting that sellers are now in complete control of the auction. At the same time, we are approaching some pretty heavy support levels below, i.e. the lower 4400s. I use a trailing 20 day for my “monthly” OTF, and it’s telling me that 4459 is the low of the last 20 days, though folks like Smashelito use the true month, i.e. the low of July, which doesn’t end until 4419.50.

Market Structure

Tuesday’s session has very thin volume (poor structure) both above 4478 and below 4461, suggesting that both sides of the auction are incomplete, with some bias to the downside as the VPOC sits at 4465.50.

Trade Plan

As per usual, when I don’t otherwise have a special pivot in mind, I default to the previous session’s VPOC. In this case, I will observe 4465, the VPOC of Tuesday’s session. To the downside targets 4445, a significant level from earlier in July, as well as 4437, another 10ish points below that, further below, I see 4420 as a possible termination for sellers, i.e. strong support, corresponding to the July monthly low. Above targets 4470, Tuesday’s session halfback, and then 4478, Tuesday’s VAH. Beyond that, we would target at cleanup of Tuesday’s A period to 4492 and beyond.

Will the selling continue until morale improves? Or one of these days are we going to find a local bottom and continue this multi month rally?

Stay agile, respect risk, use stops.

Key Levels

Pivot: 4465

Bull Levels: 4470, 4478, 4492

Bear Levels: 4445, 4437, 4420

Notes: FOMC minutes at 14:00, but I expect this to be a nothing burger.

Trade Review

+$7.15 in the simulator, and glad it was the simulator. Fought my way back, was down $400 at on point and up $100 at one point once again because I didn’t manage my winners optimally. Most of the money came from shorts after IB low break, and the weakness after FOMC, this one felt almost effortless and was nearly a perfect MAE:

Also on the long side after the NLOD reflexive rebound. Also, from here on out I think I am going to trade MNQ. It fits my personality better in that it gives you immediate feedback as to if the trade is going in your favor. I have lots of work to do, probably will be in the simulator tomorrow as well, hopefully a bigger green day.

Cheers and as always, good luck out there!

-Chris

A reminder that I am still ultimately a beginner to intraday trading and trading futures. This is not an alert service and none of this is financial advice.

Originally published at https://amtjoy.substack.com.