Trading The Wyckoff Way

[DbPhoenix 42]

We are again in a clear downtrend, and have to make use of july levels to define SR as no meaningful congestion is at hand during the last months.

 

At 63, we are near the bottom of Nov 9. During the morning there has been some support at , 60, but is yet to be tested during the following minutes, if 60 does not hold these are my levels of interest:

 

54

47

38

 

 

Why?

 

Db

 

.........................

[Niko 10]

Db,

 

I don't get the question, are you asking why did I use the july levels, or why are those the specific numbers I am focusing on?

[Niko 10]

My recount of the day,

 

 

1. After the open prices reached the S level at 54, there buyers managed to keep sellers above 53 and finally set a DB.

2. As prices reached 60 some supply came into the market, but is was not enough to stop buyers from taking prices even higher.

3. At first it appeared as if 68 would not provide enough R , but after reaching 72 sellers managed to take the prices down to 68 again, there buyers started coming in again.

4. By the end of this trading range their strength had shifted again to the buyers side, as the upwaves became stronger.

5. Sellers held the market at R at 76, and after a Triple Top, sellers took control of the market.

6. Seller’s strength faded at S at 68, where buyers rapidly erased sellers decline and managed to break above R at 76.

7. But then a LH signaled that buyers lacked the strength to take prices even higher, this gave sellers the chance to mode to the MP of the 68-76 area where buyers managed to take the market up to R again.

8. There a LH signaled buyers weakness, that then developed into a down move, that.

9. After a new attempt at R, finally made it to S.

10. At 68, sellers ran out of steam after a strong and swift downwave, giving buyers the chance to set a HL and from then, although not without effort a rise towards R.

11. By this time 76 was no longer holding as R and prices crossed swiftly.

12. By 11:00 prices managed to reach the 84 level.

[DbPhoenix 42]

I was wondering why those particular numbers. I don't see them on your chart. Which doesn't necessarily mean they aren 't there.

 

Db

[tomerok 10]

Here's my journal for today

as usuall

WHITE are RT notes, YELLOW are my post analysis notes

 

Tomer

 

 

[pjohnm 10]

13.11.12 The opening was something of a surprise given that S at 2561 and the PDL of 2556 were broken beforehand. (Looking for short opps would be the sensible option given the trend and that we were yet to test the bottom of the trend channel).

 

Post open, the fact that buyers consolidated at 2561 (note cluster of bars) before moving above 61 should indicate that buyers were at least willing to fight their battle in higher territory.

 

66 was a less obvious level of S/R, and a brief brk of the dl did nothing to suggest that sellers were going to step in here.

The larger reaction came at 72, but the pullback could not reach 66 and those looking here to join in the prevailing trend were disappointed.

Note that the move up from 66 to 72 did not pause to create a swing point, which meant that there no levels of significance in between.

 

The next upwave from 66 to 75 was almost vertical, and again did not create a swing point along the way, which may be a factor in the increasing length of the downwaves. Price comes back all the way to 67, before expanding almost vertically again to 79. All this suggest that 72 was not an important level, and the PA provides little to suggest where S/R may next form.

 

A dt at 79, followed by a LH, mimics what happened at 75. Buyers are clearly struggling (note fanning of dl's), but the LH's at 66,67,69 reflect the uncertainty of the selling pressure.

The break of the hinge to the downside fails, buyers step in to hit 85, a rise of 30 pts from the OL.

 

Exiting and re-entering the long would have led to as much frustration as those looking for a short until the eventual upmove from the hinge. (The chart contains areas where I felt entries were valid, exiting at brks of dl's / sl's).

[boru 10]

The first chart has my premarket s/r lines the second chart I readjusted some of the lines as s/r shfted. A few things to consider, this chart was marked up after trading hours so I had the benefit of hindsight and time,I was watching this in RT and most of my notes were from 9;30 to 11;00. I am in the process of drafting a trading plan entering on RET's after HH's and LL's.This is a work in progress any comments and corrections would be welcomed.

1.I was watching 60 and 56 for support

2. price dropped through 60 premarket and appeared to be holding at 56.Price rallied off 56 but buyers couldn't even get price back to 60. The market opens with a push below 56 to 53 where support comes in and pushes market higher

3. Price breaks the LSH and forms RET. Buying pressure pushes price to HH.

4.Another HH and RET and price makes HH.

5.Price hits 72 I had 67-70 as a zone of R another RET and push to HH's

6. R at 77 price was sitting at the top. RET

7.looked like price was moving up but I think the buyers needed a break price trades down to S at 68

8.buyers step in and take price up to 79

9.HH at 79 looking for a RET

10. Small drop price can't get back to the highs drops again PA getting a little choppier.

11. Buyers take price higher but can't reach the highs LH.

12 sellers push price to LL.looking to shoert a rally?

13.Price moves lower but sellers lack conviction price doesn't reach the lows at 10;08.

14. LH shorting oppt?

15 slightly LL. I was so intent looking for HH's LL's I only now recognized the TR. buying pressure takes price up to the top of range

16. HH. quit for the day

[franko 10]

below 2600 are my numbers for the 14th.

90.25

86

71.5

60.75

51.5

41.5

29.75

they are drawn from the june - july time frame.

could be argued that they should be refreshed,

drawing from the november 8 thru 13 period.

when then were drawn, they were very stong; ie

spread between 3, 4 or 5 swings so i elect to continue with them.

[Gringo 10]

Futures in pre-market are showing some strength. Price is weak but has started to resist downward continuation around 63. This may be an early attempt by demand to halt the downward movement. 63.5, 64, 64.5, 65 are some levels where supply might show up in case price rises. Lets see if this is the start of an attempt to get out of the trend channel. Note the tighter supply lines to enhance the supply and demand dynamics.

 

 

 

Gringo

[Niko 10]

Db,

 

Perhaps one of the charts did not show up, there were some levels below price that I got from the a longer TF:

 

[Niko 10]

After setting a HL yesterday buyers did not manage to break above 584, if this was short selling then perhaps today we will not get much of a following, if not we will see.

 

My levels for the day. (at 7 AM prices are around 576):

 

Bellow price:

 

 

569

557 MP area -559 Yest low

553 Mon Low - 554 Top of a minor TR in July 25-26

547 Top of Jun 11 to 14 TR

 

 

Above Price:

 

 

584-587-589 various congestion points.

597

607

[tomerok 10]

Long term view : price still "lean" on the DL, though a clear Support is now visible

Last 3 days formed a hinge like congestion, which looks like is ready to break out.

Last 2 TR are aligned with their MP

Price is popping up at pre-session, last TR high R holds

 

 

Areas of interest

2607

2597

2585

2572

2557

 

 

 

 

Tomer

 

 

 

 

[DbPhoenix 42]

A question arose yesterday regarding Wyckoff's instruction regarding interday trends and the intraday trader and my own modification of it. The following is an attempt at clarification.

 

Wyckoff wrote that the trader's actions should be based

on judgment of the technical position: Supply and demand --support and pressure.

 

No news, earnings or other corporate or fundamental statistics are considered; we use only those which relate to the factors: Price Movement, Volume and Time.

 

The active trader who is a Tape Reader is concerned only with the immediate trend of the small moves in the market. This trend can be detected by this Method soon after the opening of the Stock Exchange...

 

This form of trading disregards the long trend of the market, as well as the intermediate trends. It takes instant advantnge of the technical rallies and reactions that promise to yield a profit in the same stock market session, on either the long or the short side of the market.

This instruction, of course, must be understood within the context of tape reading, i.e., trading ticks. There were no bar intervals as there were no bars, just ticks (transactions). There were no charts other than those drawn by hand by the trader, hence the utility of point-and-figure. There was of course no "zoom".

 

The primary value of the interday trend in this regard would be to alert the trader to the conditions for a possible reversal, i.e., when price approaches or bounces in the proximity of one side or the other of the trend channel, as below:

 

 

 

 

 

 

Otherwise, for intraday trading, this information is of little or no use. My own comment on the matter -- "interday trend is largely irrelevant to the daytrader unless some important level that might affect the intraday trading is nearby" -- was made in appreciation of the fact that the modern-day trader has many other tools at his disposal, including digital intraday charts that can display data in a near-infinite variety of forms, at the very least showing intraday trends and trading ranges, hence the second part of the statement: unless some important level that might affect the intraday trading is nearby. If, for example, the daytrader is tracking an upmove, he'd be wise to consider that he's approaching a trading range from a previous session, a range which might well offer important resistance. This hinge, for example, formed two days ago, has offered resistance twice, once yesterday and once this morning:

 

 

 

 

 

 

To ignore such information simply because it is from a previous session would be self-defeating.

 

Therefore, even though whatever interday trendlines the trader might come up with may be irrelevant to an intraday trade, particularly since it is the trader who came up with them, the levels and zones provided by trading ranges, since they are "drawn" by the market, may have an important influence on price's movement and the profitability of the trade.

 

Db

[DbPhoenix 42]

The following is a copy of a post I just made to the TBP thread. I've copied it here because it is particularly pertinent to trading intraday trends:

 

 

A question arose yesterday regarding Wyckoff's instruction regarding interday trends and the intraday trader and my own modification of it. The following is an attempt at clarification.

 

Wyckoff wrote that the trader's actions should be based

on judgment of the technical position: Supply and demand --support and pressure.

 

No news, earnings or other corporate or fundamental statistics are considered; we use only those which relate to the factors: Price Movement, Volume and Time.

 

The active trader who is a Tape Reader is concerned only with the immediate trend of the small moves in the market. This trend can be detected by this Method soon after the opening of the Stock Exchange...

 

This form of trading disregards the long trend of the market, as well as the intermediate trends. It takes instant advantnge of the technical rallies and reactions that promise to yield a profit in the same stock market session, on either the long or the short side of the market.

This instruction, of course, must be understood within the context of tape reading, i.e., trading ticks. There were no bar intervals as there were no bars, just ticks (transactions). There were no charts other than those drawn by hand by the trader, hence the utility of point-and-figure. There was of course no "zoom".

 

The primary value of the interday trend in this regard would be to alert the trader to the conditions for a possible reversal, i.e., when price approaches or bounces in the proximity of one side or the other of the trend channel, as below:

 

 

 

 

 

 

Otherwise, for intraday trading, this information is of little or no use. My own comment on the matter -- "interday trend is largely irrelevant to the daytrader unless some important level that might affect the intraday trading is nearby" -- was made in appreciation of the fact that the modern-day trader has many other tools at his disposal, including digital intraday charts that can display data in a near-infinite variety of forms, at the very least showing intraday trends and trading ranges, hence the second part of the statement: unless some important level that might affect the intraday trading is nearby. If, for example, the daytrader is tracking an upmove, he'd be wise to consider that he's approaching a trading range from a previous session, a range which might well offer important resistance. This hinge, for example, formed two days ago, has offered resistance twice, once yesterday and once this morning:

 

 

 

 

 

 

To ignore such information simply because it is from a previous session would be self-defeating.

 

Therefore, even though whatever interday trendlines the trader might come up with may be irrelevant to an intraday trade, particularly since it is the trader who came up with them, the levels and zones provided by trading ranges, since they are "drawn" by the market, may have an important influence on price's movement and the profitability of the trade.

 

Db

[boru 10]

After the runup in the am yesterday price retraced all its gains trading back very near its open at 60. Price then traded higher overnight to R at 2585. and has drifting downward since 4:30 am.broke its TL at 7:00 am and LSH at 78.75. My levels for today 2585,2594 and 2607 above and 2570,2560-2556 below.

[Bern 10]

These are the levels I will be initially watching for today. I could add something if there is significant price action prior to opening of regular session:

 

2637-40

2615

2604

2597-2600

2585-86 13th H and ov H DT, mp TR fm 9th and 12th

 

2572-74 mp TR 13th

2553-57 SL from 13th and 9th

2538-40 mp TR July

 

[pjohnm 10]

14.11 Pre Mkt

 

Price still at the bottom of the trend channel.

Buyers appear reluctant to take price above 2600, likewise S at 2560 has held firm, another break below may be significant.

 

R was somewhat soft during the previous days session, with 84 providing the most reliable level.

[tomerok 10]

today i was sitting on my hands and probably avoided some significant loses

 

as usual white are RT notes, yellow are post analysis

 

 

Tomer

 

[Gringo 10]

This is an analysis of Dow Jones US Heavy Construction Index.

 

I came with a heavily negative bias towards the housing market. It took a little bit of adjustment to accept what price was showing than forcing bias on the analysis. You may notice a bit of downward bias earlier in the analysis on my part. By the time I reached the end some clarity of mind was beginning to emerge.

 

This is the first time I am attempting to analyse this index so there are bound to be points that I might have missed. I am not even sure who of if anyone even looks at this but it's my attempt at getting used to the housing market behaviour.

 

Top down approach: Monthly -> Weekly -> Daily chart analysis. Notes are within the charts.

 

 

 

Daily analysis surprised me with the better behaviour than the Q's. The upside is twice as fast and the downside is comparable. Who wouldn't want an index skewed to the upside.

 

Gringo

[Niko 10]

My analisys for the day:

 

This were the levels posted in the TIF thread.

 

 

Bellow price:

 

569

557 MP area -559 Yest low

553 Mon Low - 554 Top of a minor TR in July 25-26

547 Top of Jun 11 to 14 TR

 

 

 

1. After the open the market stayed in a small TR with a top at the 76 R level, after a first attempt, buyers did not manage to hold their advance, and sellers rapidly set a LH, but were not strong enough to take prices to S.

2. Once again Buyers attempted to take prices above R, bur were held on 76 by sellers who managed to take prices smoothly below the opening TR.

3. After reaching S at 68 price kept on falling but found buyers at 64, from there prices went nowhere between 9:55 and 10:12 in an 8 point TR. By 10 16 after managing to stay in the bottom of the TR and forming a small hinge, sellers finally showed their willingness to commit and managed to take prices down with decision. This made 64 the new R level when prices pulled back at 10:19.

4. S at 60 was taken out fast, and became R on the second attempt by buyers to take prices up again.(Did not have it on my pre-market analysis). After a second attempt a LH was formed and from then on prices fell fast.

5. At 54 prices found S again, formed a hinge that was broken to the downside with good volume, but sellers couldn't move bellow 50. By 11:00 the TL that started in 73 was broken and prices had started to rise.

[tomerok 10]

Impressive work G.

 

 

Tomer

[Gringo 10]

This analysis is for Lowes Corporation.

 

I should have probably checked the group behaviour as well. Maybe later I'll have a look. I am just pushing through analysis after analysis.

 

 

 

 

Gringo

[boru 10]

1.premarket, buyers are supporting prices at 2570

2. At 8;30 a.m.price rallies to R at 75-76 and we appear to be in a TR

3.9:55 a.m. price breaks support and drops down into a new TR at 65-70

4. 10:17 price gaps down breaking support at 65 and trended steadily downward to 50

a mix of TR and trend.

[Gringo 10]

Updates on Light Crude Oil:

 

Notes in the chart.

 

 

Gringo

[pjohnm 10]

Although I wasnt able to pay much attention this morning, I did note that after the break of the opening low of 2570 (which was also S of the pre mkt TR), buyers struggled to make it back above this level. This has been mentioned previously as something to look out for and was a factor today.