Disclaimer: For educational use only. I’m not dispensing financial advice. We are having an intellectual conversation (you and I) on the topic of trading the Emin futures using the Lens of Wyckoff Principles and the Eyes of WB’s clock. The clock that controls all turns intraday, every day!
The pace of trading slowed to the downside as the gap was filled from the previous day’s high. Bears were unable to gain a following as they tried to recover some of the gains from the previous day CASH high.
From the opening print volume was greatly increased as the first attempted direction was to the downside. It made sense, cause Globex was too long. A 10-minute down move closes the gap from yesterday’s CASH high. A 5-minute up move follows that regains over half of the reaction. Another move down for 5 minutes. This move is 5 minutes shorter than the first. The bears are unable to recover gains from yesterday.
A quick 5-minute up move at 9:50 am is telling you the Composite Man is buying on the sly all that is offered. The down move will not last. Reference the previous up move in minutes and distance. Now, draw a trend line from the start to the top of the 9:50 am (see page 4). A 10-minute down move respects the oversold line at 10:00 am. See the volume spike?
Looking at Tech stocks CRM, INTC, and DIS had bottomed out and CSCO was well on its way to higher highs. 10 minutes later the overbought line is respected again as just a small spring is seen on greatly increased volume. It’s a come-to-go with trade as the spill sees some residual bear for that 10 minutes.
If you were looking to get long. If your notion was the market is going back up. That was your place. Your notion was confirmed as overhanging offers get taken out on increased volume spikes (absorption volume) at 10:20 am and 10:30 am. And it’s a Odds and probabilities day but it’s looking bullish all day! A 60-minute up move follows that prints just short of 4198 handle checks the 11:00 am marker. A 60-minute dip at 12:00 pm. Then it’s higher highs and higher lows. That is up until 2:00 pm.
Looking Forward to February 3, 2023
Due to recent changes in market behavior, I’ve decided to change my focus to Time-based trading. This allows you to benefit from the flow of the arrow of time and not fight against the algos in the nanosecond.
A lot of traders are thinking “Wishful Thinking and Short Covering” or Upside Breakout. Volume yesterday was greater. Price rallies for 60 minutes and then is checked at the highs. Drifts down and starts to move back up at 12:00 pm. If they really wanted to buy this they would have driven it down. They were bidding it up to sell at the highs.
If you draw a support line from 12:10 pm to 12:50 pm and an overbought line at 12:35 pm you can easily see around 1:55 pm price is getting too long as volume increases. At 2:00 pm you have the confirmation price is soon to go back down again. Notice the liquidation lasts 60 minutes at 3:00 pm sharp where a bid starts to come back in the market.
Let’s see what the Jobs Report does to support or challenge the FOMC decision. Good news not so good. Is bad news good? It’s an upside-down world we live in.
4143 potential support. Next 4093 and below breakout failure.
To learn more, subscribe to my AM TURN newsletter:
Less than a cup of coffee. In your email inbox before the opening bell.