Tuesday, January 22, 2013

.5pt Con Gap + 7:00am News Release = Early Chop prior to Decline


Today we had .5pt Continuation Gap with Blocks on the globex highs. The 7:00am News release put us in a choppy market early until the 1st Ti where we moved down to 1474 area.
Recap Notes:

Trade Selection -  Good trading,  Good initial Entry,  good Exits. Sequence 1 was a 45/5 cycle sync w blocks on the highs but failed to play out in a reasonable amount of time, most likely due to the late day News release so i exited with small loses but no regrets. Sequence 2 was a C(500) reverse of sequence 1 but it was on the heals of block bars on all the Tick lows, This managed to pop in favor for solid gain.

INTANGIBLE OBSERVATIONS:
Be prepared for slow start on Late day News Releases - Today we had a 7:00am news release, this typically causes slow starts and choppy mornings, On these days it best to be VERY careful taking  high probability opportunities and quick exits on light lots.

Read the sentiment of the Market and Understand the Background - Today i was able to read the sentiment of the market due to the background strength that appeared in the globex session and the Prior Days Close. This along with the open gap of less than 2pts pointed to a continuation of higher prices albeit in a tight range. This allowed me to remain confident even when cycles appeared to be turning against the position.