Identifying Market Excess: Other Time-Frame Buyers

[Soultrader 12]

Posted below is an interesting candlestick chart showing a singe print tail below value.

 

The other time frame buyers stepped in as they percieved price to be too low. After a weak morning session, the afternoon rallly was fairly signiciant pushing prices back into value and above the openng price. The bulls have gained a temporary victory. The market excess created by the single print tail around 11310 will be a key support in the future.

 

Also notice the 11400 mark. This has been a key resistance point for the last 2 weeks and looks like it will continue to do so.

[Lisa 10]

I noticed the markets went from weak to strong. If your bias for the morning session is on the short side, isnt it relatevely hard to switch your strategy? The markets traded below the value area jus to recover all its decline and end up positive for the day.

 

How do you adjust your strategy in this case?

[Connected 10]

I noticed the markets went from weak to strong. If your bias for the morning session is on the short side, isnt it relatevely hard to switch your strategy? The markets traded below the value area jus to recover all its decline and end up positive for the day.

 

How do you adjust your strategy in this case?

 

I think one way to see for a changing market environement is using trendlines. In the chart he posted you will see that the markets broke the trendline and rallied into value. This was a fairly good clue of a changing market environment. Therefore you can adjust your strategy accordingly.

[Soultrader 12]

Couple of ways to see for market shifts.

 

1. New TICK low/highs

2. Price and TICK divergence is a good warning signal

3. TRIN range breakout

4. Higher lows then a 61.8% fib retracement

5. Break of trendline

 

These are just some of the things I watch for.