Dow Intraday charts 03/11 - 07/11

bgold

Established member
532 5
During these days with mid-day range trading, i noticed that indeed the RSI ratio analysis has provided me with improved confidence in predicting the next move. I was lucky today shorting on a safe-entry after pull back to 100ema at 15:20 when Dow quickly dropped. Although there was RSI PD, I stayed the course most of day as the RSI ratio was very weak. As you CM mentions, this ratio strengthened slowly afte,say 18:45 and I was was lucky to cover (for 35pts) at 20:00, just before DOW rallied. While i saw strength coming in, i just couldn't act / was not aware enough to go long on breakout of price, RSI and CCI. It went very fast. Within 5-10min, Dow captured 35 out of 50 pt rise.
CM, any tips how/why I could have had confidence putting in a buy stop on this move?
Apologies for ignporance but what do you mean by volume divergence in ES between Monday close and wednesday open? I am not sure I could detect a clear pattern on my charts, other than there was marginally more volume on tues down day than on mon and wednesday? Otherwise, it seems to me that most momentum indicators on the daily charts pointing to a market which is very tired.
Once again thanks for analysis.
 

mombasa

Established member
561 1
and I thought there was a bear flag developing on the 10 and 15 min - until the spike up !

yup, not very profitable tradung the 10min - I'm still short but thankfully I'm still doing the 1min. Made a mistake going short on what I thought was a pullback after the starting drop - lost a few points there but then got the next 4 trades right - ok only made a few points scalping after the dbl top 30 odd points but it's nice for one's confidence.

BTW, this was all thru Capital Spreads demo account - much better than fins with the spread and bias!
 

ChartMan

Legendary member
5,580 46
Bgold
The only way to trade that spike would have been to have been actively looking for a PD bottom, and hit the button spot on... if you dithered, the bias would have no doubt eaten you. That spike was unusual off the PD bottom. Normally, you'd get a nice take off, that suddenly makes you realise you've misssed a PD, and you can jump in. Not last night.
The vol divergence is on a 1 min chart, not eod.
Mom
100% right on the bear flag . Market just didn't do what you knew it would! ( thought it should). That's why we have stops. TA 100% right, market 100% wrong.
 

mombasa

Established member
561 1
CM - on the other hand, on 10 min chart could be a huge bull flag forming - pole from 25/10 to 3/11 :)
 

ChartMan

Legendary member
5,580 46
Mom- that would make 10, 200 then?
When I said STAY OUT, I meant stay out when the figures are released on the street!!!! NOT for the whole day. Channel break and that looks to be the down leg done.Current CCI status leaves room for 100+ points to the upside, but RSI is topped out. If we are to go up, then RSI has to fall back , revealing weakness as it has to get back to the 30's/40's before it can push up.Clear cut close for the 10 min short as the 100MA AND the res line was broken around 9810.
From the bull flag perspective, this portrays a weakness seen in the 1 min charts. Notice the 3rd attempt at a low fails to meet the "expected" support line. This is a common signal saying that the bull flag will break to the upside as expected. That was coupled with PD.
BUT I hear you say, the support line only touches the price in ONE place..... that is because I favour drawing trend lines in parallel channels on a "best fit" basis. Clearly, the top resistance line has a perfect fit, so I draw the lower one parallel to it such that it "looks right ". This is a process of continual re-adjustment as the day goes on.
 

Attachments

  • dow 06-11-03 10.gif
    dow 06-11-03 10.gif
    26.6 KB · Views: 415

ChartMan

Legendary member
5,580 46
Just a quicky... the opening triangle that started at yesterday's closing peak gave a target of 9840. Cheak the relative RSI ratios on the two circled areas... The second bull flag at 9810 had a target of 9837, confirming T1. Still finding support on RSI 30 and bumping off 9832. Are the figures leaked out?????
 

Attachments

  • dow 06-11-03 1.gif
    dow 06-11-03 1.gif
    25.3 KB · Views: 413

tradesmart

Experienced member
1,286 22
Hi ChartMan/All,

I guess that we all have our own interpretation of the day's chart action to an extent, and I believe that you've mentioned this before yourself - I saw a PD double-bottom set-up and had no hesitation about going long at 9785.........the pattern of a weak open and a strong close has been repeated several times recently.

Regards, TradeSmart
 

Attachments

  • dow 06-11-03.jpg
    dow 06-11-03.jpg
    109 KB · Views: 381
Last edited:

mombasa

Established member
561 1
Hi CM,

That would be nice wouldn't it - I guess I should remortgage my house and go for it :)

Not sure how well the TA works long term - let see ...... good start with the break anyways.

On yesterdays action, I went long on the first pullback in the first circle u've drawn - got a bit worried when I saw what looked like a dbl/tripple top but stayed in because the RSI/Price ratio was very weak and it looked like a bull flag forming - trouble is there was ND as well (or looked like ND to me). So, I was a bit nervy at this stage.

Question - did that look like a dbl top to u? Do bull flags often look like dbl tops with ND to boot - how do u distinguish between a real dbl top and a potential bull flag? I made my fina judgement on the RSI/Price doodah.
 

tradesmart

Experienced member
1,286 22
UBS Warburg this week boosted its forecast for October payroll growth to 125,000, from an initial estimate of 50,000. The firm said the hiring of replacements for striking California grocery workers will add about 40,000 jobs, and that other recent reports point to an upside surprise.


but we don't gamble do we? - it's got nothing to do with T/A.. ;)
 

bgold

Established member
532 5
All,
Which Dow Jones future/instrument would you recommend as trading vehicle in terms of liquidity and bid/ask spread?

I have been trading YM but experience at times lack of liquidity, especially pre-market. I was just partially taken out a long at 9867.5, very unfortunate (at least for now).
Thanks
 

rossored

Senior member
2,103 56
Premarket liquidity on YM is dreadful, thats why. You should already know that if you're trading it! ;) There is no Dow contract that is any more liquid I dont think : YM $5 increases in trading volume all the time according to CBOT, but if more liquidity is what you're after, then move to ES.

Anyway, liquidity has nothing to do with why you were taken out of your position.
 

oatman

Senior member
2,879 22
UBS Warburg weren't wrong.
I was wondering why the markets got excited about a figure that was 65000 more than some expected in a working population of 140 million. :rolleyes:
 

ChartMan

Legendary member
5,580 46
Bgold- premarket is a gamble and so sloooooow. YM is ok as is ES during normal trading hours. YM is ok for small lots as already mentioned.
MoM - Remember that all TA is made up of little bits and it works in all time frames ( sort of). So you are correct- it was a little double top, so we get a bit of down. We have a d/top at 9900 on the 10 min chart, so we got some down coming. Right now we just had a double bottom at 9860 so what part of a bigger picture will that become? Right now we have a potential bull flag on the 1 min chart. (16:10). Don't think of what you see as a "snapshot", try and think of what may be coming, to form something more significant. This bull flag may turn into a flat bottom triangle with a target of 9820. But first it'll test the magic 9864 which today happens to be at 9860 ( sounds contradictory!).
A quick look at ES and VOL suggests it wont go down......
I'll pass on this one- RSI is too low to take a short.
 

ChartMan

Legendary member
5,580 46
Now come off the lows, after a false base break. Still, the upside looks ok. Maybe we'll finish at 9901. I'll be gutted if it's 9900 or 9911. :cheesy:
ps 3rd lower low on ES vol, 1 min
 

mombasa

Established member
561 1
CM - it seems to be finding support around 9860 - still looks like a terrible day to trade tho - I'm long from 9870 with stop at 9850. Be happy if it goes to 9900 - doubt it tho :(

Still looks like a bear triangle !
 
Last edited:
 
AdBlock Detected

We get it, advertisements are annoying!

But it's thanks to our sponsors that access to Trade2Win remains free for all. By viewing our ads you help us pay our bills, so please support the site and disable your AdBlocker.

I've Disabled AdBlock