Bob Volman Price Action Scalping

[stehlikpetrmsncom]

My four trades today.

 

[BLS]

E1: I thought it was worth the risk (~5 pip stop) since the bulls couldn't follow through after prices tried to test the 20 level at around 5:33.

E2: Quickly realized I was wrong on E1 and saw that false break of the 20 as a very bullish sign for an upward break. Since the 20 level was holding strong it seemed like a good candidate for a long towards the 40. There is some resistance above from that earlier range/block but I thought there was enough tension in this range to overcome that. I was paranoid about the 40 level, probably because of yesterday where my trade soured 1 pip below the 40 level so I ended up closing my trade out early.

E3: Trap. Oh well.

M:ARB: I had to use the bathroom at the worst time

 

[TonyIommich]

Nice to see everyone here still actively sharing ideas based on Bob's work.

Personally I've scrapped the 70 tick and am back to using Oanda's 30 second chart for what I do. My target is just to trade the NY-Europe session for 2 hrs a day so the liquidity is consistent enough overall without needing the benefit of tick's consolidation. When the market starts moving fast like it did today as it broke out of the 40 zone, I just use my judgement, and most of the time my judgement tells me to stay clear of something that is moving too quickly because the volatility jumps and stops are often taken out.

I've also found that for the life of me most of my trades never hit the 10 pip target that Bob suggests, so I've found it much better to shoot for more conservative amounts (I find that 7-9 points usually works well). Clearly we're just in a different market environment these days, though I'd say September was an improvement over August which was just total death, the market was just moving in 5's back then.

 

[samich1262]

Nice to see everyone here still actively sharing ideas based on Bob's work.

Personally I've scrapped the 70 tick and am back to using Oanda's 30 second chart for what I do. My target is just to trade the NY-Europe session for 2 hrs a day so the liquidity is consistent enough overall without needing the benefit of tick's consolidation. When the market starts moving fast like it did today as it broke out of the 40 zone, I just use my judgement, and most of the time my judgement tells me to stay clear of something that is moving too quickly because the volatility jumps and stops are often taken out.

I've also found that for the life of me most of my trades never hit the 10 pip target that Bob suggests, so I've found it much better to shoot for more conservative amounts (I find that 7-9 points usually works well). Clearly we're just in a different market environment these days, though I'd say September was an improvement over August which was just total death, the market was just moving in 5's back then.

I am really glad that the market is moving again, but I'd be curious to revisit August to see if I could do better. At that time, I didn't understand IRB's at all, and that seemed to be the main tradable opportunity during that time. I skipped all of them.

 

[samich1262]

E1: I thought it was worth the risk (~5 pip stop) since the bulls couldn't follow through after prices tried to test the 20 level at around 5:33.

E2: Quickly realized I was wrong on E1 and saw that false break of the 20 as a very bullish sign for an upward break. Since the 20 level was holding strong it seemed like a good candidate for a long towards the 40. There is some resistance above from that earlier range/block but I thought there was enough tension in this range to overcome that. I was paranoid about the 40 level, probably because of yesterday where my trade soured 1 pip below the 40 level so I ended up closing my trade out early.

E3: Trap. Oh well.

M:ARB: I had to use the bathroom at the worst time

BLS, you and I have very similar trading tendencies. We both have been getting spooked and take the occasional revenge trade (I did that yesterday, almost the same thing that you did on that first trade into the 20 level).

I saw that first trade as almost a giant bear flag/IRB. You could draw a pretty clear diagonal line , and then a box. I don't like breaks at the end of a diagonal move in the same direction usually, so when I saw this getting support in the 20 zone, I was automatically looking for a break to the upside instead of the downside. It also was about a 50-60% retracement of the previous bullish move, although it was sort of ranging so I'm not really sure if that is something I should pay attention to in this case. The box/IRB had nice pressure before breaking to the upside. My thought process was:

-50% pullback/possible bear flag
-support in the 20 zone
-bullish pressure inside box/IRB at the end of the flag

I thought that made for some nice odds. I probably would've taken that same false break to the downside had I not done basically the exact same thing on Monday. On your second chart, I was looking for a repeat of the same setup, but never saw a setup so I stood on the sidelines.

PS - I drink a lot of coffee, so I know what you mean about missing trades in the bathroom!

 

[samich1262]

I watched the bullish breakout on the EUR/USD and GBP/USD at the same time. The GBP had a more clear setup to me, and I didn't really see a valid entry on the EUR/USD. This setup shows a BB at the end of a sideways pullback. It gets some squeeze from the EMA, not quite as much pressure before the break as what I would like to see but there are three 1-pip dojis about 1 pip away from the barrier. In a trend this strong, that should probably be enough. Price is unable to approach the 20 level below, and we have a couple higher bottoms. Trend continuation looked like a good bet.

I am really trying to shift my focus to reading conditions first. That way I can say, if a setup shows up right here, I can take it. I won't miss out on as many, and I won't jump in on a nice box when it is in the wrong place on the chart. I feel like a lightbulb came on in my head from an analysis standpoint last week, but I still need to make that show up during my live trading on a consistent basis.

 

[shotgun77]

My four trades today.

I noticed your nice comments on your charts yesterday. And again today. I find them very helpful. They are very "Bob-like".

On your failed RB on 2nd chart, did you exit as soon as the bar closed beneath the ema? That is where I see Bob marks exits on charts he shares. It looks like where you'd have put your original stop too.

 

[stehlikpetrmsncom]

I noticed your nice comments on your charts yesterday. And again today. I find them very helpful. They are very "Bob-like".

On your failed RB on 2nd chart, did you exit as soon as the bar closed beneath the ema? That is where I see Bob marks exits on charts he shares. It looks like where you'd have put your original stop too.

Thanks, I'm glad you like the notes.

I did put my stop just below the squeeze and therefore exited on the bar that closed below the EMA, however at that time I wasn't completely sure if it wouldn't have been a better idea to put stop one pip lower. But in the end it probably doesn't matter much, the barrier here was clear and the market rather slow-paced, so I didn't feel the need to give this trade wider stop.

 

[samich1262]

Does this trade seem too aggressive? Since I just started paying attention to price behavior near the 20 levels, I wasn't confident enough to jump into this IRB yet, but I want to make sure my analysis is on the right track. Putting conditions first feels weird at first, and almost feels like a "hunch" when the setup itself isn't quite as nice, but I'm sure that will go away when I am more confident that I'm reading conditions correctly. In this case I wanted the IRB to be a little more extended and I would've participated, but I don't know if that was necessary. My thoughts here were:

-Price fails to retest the 20 level on 2 attempts. I assumed this would mean it is likely to go down and retest the round # again.
-We have a little BB with EMA squeeze
-Trend continuation potential

Concerns?
-Round #, but it is exactly 10 pip away

What do you think?

 

[stehlikpetrmsncom]

View attachment 146430
Does this trade seem too aggressive? Since I just started paying attention to price behavior near the 20 levels, I wasn't confident enough to jump into this IRB yet, but I want to make sure my analysis is on the right track. Putting conditions first feels weird at first, and almost feels like a "hunch" when the setup itself isn't quite as nice, but I'm sure that will go away when I am more confident that I'm reading conditions correctly. In this case I wanted the IRB to be a little more extended and I would've participated, but I don't know if that was necessary. My thoughts here were:

-Price fails to retest the 20 level on 2 attempts. I assumed this would mean it is likely to go down and retest the round # again.
-We have a little BB with EMA squeeze
-Trend continuation potential

Concerns?
-Round #, but it is exactly 10 pip away

What do you think?

My concerns would be the double bottom exactly at 00 level and then subsequent higher low, it looks too bullish in my opinion. But I don't know.

However, I think you shouldn't be concerned with the round number itself, quite the opposite, you should welcome it in this scenario (vacuum effect).

 

[samich1262]

My concerns would be the double bottom exactly at 00 level and then subsequent higher low, it looks too bullish in my opinion. But I don't know.

However, I think you shouldn't be concerned with the round number itself, quite the opposite, you should welcome it in this scenario (vacuum effect).

Good point. The double bottom did look a little sketchy. But from a bearish side we had a double top and a lower double top, and I thought that might sway things in favor of bearish. I guess that makes 4 bearish signs and 2 bullish that I can think of. I think what is scary about the double bottom is that it shows round # buying interest.

 

[samich1262]

Good point. The double bottom did look a little sketchy. But from a bearish side we had a double top and a lower double top, and I thought that might sway things in favor of bearish. I guess that makes 4 bearish signs and 2 bullish that I can think of. I think what is scary about the double bottom is that it shows round # buying interest.

What do you think of the bear flag to the left of that setup?

 

[stehlikpetrmsncom]

What do you think of the bear flag to the left of that setup?

To be honest I am not sure where is the bear flag, I don't see it

 

[shotgun77]

@samich1262
I like it for all the reasons you stated but I tend to be aggressive! I also notice this action:
The first leg up after the DB stopped right at the tiny BB to the left with a spike bar on bar prior to that point. To me, that means sellers were just waiting for it to get there before stepping in. Then on the retest that formed the lower high DT, sellers came in again.

Also, you can draw a bear TL on that action on the second retest that guides/squeezes nicely.

I also see it as a reverse cup 2 Handle (3 arches with lower highs) at resistance level.

It is aggressive because the ema has barely turned down at the break. So maybe you wait for the arb which seems to be an angular bb.

 

[shotgun77]

To be honest I am not sure where is the bear flag, I don't see it

Ditto.

 

[BLS]

Ditto.

I think he's talking about this one.

I don't think I even noticed that possible setup. It looked like the market had trouble picking a direction and all I could see was resistance to any possible trade so I just watched. I did eventually get trapped when I took an impulsive trade though. I kept telling myself that I should wait for more buildup since it had to crack the 20 to the upside but when I saw the break I just immediately pressed "buy". That was stupid of me.

 

[samich1262]

Hmm, I thought I remembered that bear flag having a better BB at the top. Lol, it was right when I woke up, I must have been half asleep. That first trade to the left is the bear flag that I was referring to, but it looks like the box that I drew is a little high above the average. It does cross the average on the break but it lacks squeeze. I guess I could lower the bottom of the box by a pip, that might look better but it's still not that great. I knew to be looking for a short setup there since it is a 50% retracement of a bearish move, but maybe this wasn't really a setup? It does have the support of the 20 level though, basically making a double top there, and it's got enough room to work with before hitting the round number.

You may be right about that ARB. For some reason I didn't think I could take it after an IRB like that. I thought price would retest the ceiling of the IRB break? But there are some examples in the book that look like it could be a good trade. That double bottom is kind of blocky and it could stop price from climbing back up into the range. I have actually only read the ARB chapter once or twice, and it's been awhile. I need to go over it again, for now I gave most of my attention to getting comfortable with BBs and IRBs.

 

[stehlikpetrmsncom]

I think he's talking about this one.

I don't think I even noticed that possible setup. It looked like the market had trouble picking a direction and all I could see was resistance to any possible trade so I just watched. I did eventually get trapped when I took an impulsive trade though. I kept telling myself that I should wait for more buildup since it had to crack the 20 to the upside but when I saw the break I just immediately pressed "buy". That was stupid of me.

That chart is a prime example of a price formation I don't know what to think about.

I added a schematic picture:

Basically we have a trend (1), then some kind of barrier line (2) that gets broken in the direction of the trend (3), then price returns back (4) and and eventually pushes on the resistance again (5).

Now what does that mean price technically? Is the barrier significance strengthened and should we look for continuation (withtrend) setup, or is the return below the barrier sign of bearish strength?

Sometimes it looks like head and shoulders (topping pattern), sometimes I guess it can be traded as BB using angular lines, but it confuses me overall. What's your stance on this formation? I'd like to understand it from buyers and sellers point of view, I can't decide who does it favor.

 

[samich1262]

I think he's talking about this one.

I don't think I even noticed that possible setup. It looked like the market had trouble picking a direction and all I could see was resistance to any possible trade so I just watched. I did eventually get trapped when I took an impulsive trade though. I kept telling myself that I should wait for more buildup since it had to crack the 20 to the upside but when I saw the break I just immediately pressed "buy". That was stupid of me.

I almost took that trade too, but stopped since it was right below the 20 level. It was kind of a weird day since it only stayed in a 20 pip range. Maybe because tomorrow is the FOMC day.

 

[stehlikpetrmsncom]

I almost took that trade too, but stopped since it was right below the 20 level. It was kind of a weird day since it only stayed in a 20 pip range. Maybe because tomorrow is the FOMC day.

It's because of german bank holiday.