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!
Let’s call yesterday what it was. A SHAKEOUT. Shaking out the weak hands. Wyckoff saw the market in terms of the Composite Man. He said there were strong hands and weak hands. Professionals / Insiders versus Public / Outsiders. Then he took the combined net forces of all buying and selling and saw the market through the eyes of the Composite Man.
You can see the Composite Man by observing the Selling Pressure and Buying Support as reflected in buying and selling waves. As the market opened, the Composite Man saw that weak hands had bid price up over Globex. You can clearly see two pushes up. It was the PEONS with a slew of positive earnings updates and expectations. They got over their skis WB would say. Wyckoff would say; upthrust previous days CASH high. Yesterday had exponential odds of a shakeout as the PEONS were over their skis and it was an S4L day. A real diver-down day.
Looking at Wednesday 2/8 you can see a 4-hour base of accumulation from 11:30 am to 3:30 pm. The weaker hands drove price over Globex on low volume and got Globex overbought. As the open, the Composite Man checked this buying wave. Since the buying support was over the range of Wednesday’s Cash, odds favored a retracement of the day as price opened inside at the top of Wednesday’s range.
There were three trades yesterday that followed the path of least resistance. And no they were not catching falling knives. At the open you can see selling pressure for 15 minutes and buying support unable to take out the opening print. You’d gone short of the market at 9:55 am. Now, the 1930 Barca lounger boys, they’d just pick up the phone and short the market at the open.
If you went short, you’d look for confirmation in the market with continued selling pressure. Another down move for 10 minutes and a 20-minute buying wave fail to recover even half of the decline. It took 10 minutes longer to recover twice as less. That was your confirmation. And if you wanted your first short or add to your first.
Seeling pressure takes out the current low and finds some buying support at the 10:30 low. Which is the AM low. Your odds are stacking. You can see we are now at halfway retracement of the previous day’s CASH range or Globex. A 30-minute buying by weak hands failed to regain just half of that loss. That is also the MID AM HIGH, your odds are increasing it’s going to be a shakeout.
Selling pressure remerges itself and a 60-minute selling wave offers down without any support. It’s 12:00 pm and we are looking for the lunch low. This is key with WB’s clock we are looking for a low within the next hour and a half to two hours. If you want to get short you might want to get short on this next up wave.
A 30-minute up wave recovers just half of the 60-minute decline. This is confirmation the bulls are weak and unable to gain a following. This is your second trade. And the one I caught the Lunch Puke. Selling pressure forces the market down for 20 minutes with not a bid in sight. The Settle, the bid, the low, and all points of controls levels and references are taken out.
It’s the most drastic pushdown. The market is telling you it’s weak. The Composite Man is shaking out all the weak hands and the day is not over. The third trade is coming soon. We’ve just taken out the previous day’s low. A 60-minute down wave. Buying support is coming in and for 40 minutes have not even recovered a third of the reaction. The bulls are weak and unable to gather a following. Activity trails off. It’s the middle of lunch and volume decreases.
And to increase the odds, price has entered the day’s lows. It’s your third trade don’t miss it; It’s lunch and we have a rally. WB called it the SLOG serving up Algo soup. It’s 1:30 pm and bulls are unable to take price higher. It’s a sell the rally take profit on the dip day.
Selling pressure dominates the market as prices are offered down till 3:30 pm. Shorts got to exit their trade before the close. We get a 20-minute short covering rally. I trust you too were one of those shorts who took their profit on the break at 3:30 pm. It was a shake-out S4L nose-to-toes kind of day!
Looking Forward to February 10, 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.
I don’t have the software to look for icebergs, but in IMPRO chat some of the bigger traders call them out, and then I can see on my DOM the ICE but not the Burg…
To me, they are just natural levels where support should come in but it does add to my confirmation. Sure I found a bid coming in at the 4115, 4105, and 4100 and then the Algo’s took it down further.
These were professionals. Insiders. The better informed. Better positioned traders. The traders who could sustain a 20-handle dip and more. As I write Globex has taken price down from the 4091.75 Settle to 4084.50 handle. And I’m sure they will challenge the CASH 4078.25 low.
I’m thinking the Composite man did shake out the weak hands yesterday. In lieu of that, he may also decide to throw over some of those support positions. It could be potential preliminary support. With the Selling Climax coming today or later next week.
There is plenty of air in there…
If Globex gets price much lower you could see a potential oversold technical position. This would lead to buying support at the open or later. The market is very uncertain and a technical traders market.
4-month up trend. 7-week up trend. Near outside day. Trending down. Dec high 4208 handle. Composite Man Shakes out the Weaker hands selling with no insider participation. Last 4097.75. Settle 4091.75.
Bear Story: They got done what they came to do yesterday. Could they have done more? I did not see any professional insider selling. This confirms the Shake out of weaker hands.
Bull Story: Weaker hands were shaken out. Some support came in at the big 4100 even. The last 2-hour selling wave may have exhausted the bears. Opportunity for a soap drop.
My Story: It’s an S1H day. My notion is buying support could come in and I’m looking to buy on the spill down (9:30 am to 9:57 am) but the PEONS have not opened up. If the price is too oversold and the news is really bearish I will buy on the open.
I’m not always this verbose. I really wanted my subscribers and my future subscribers to understand yesterday not through my eye’s but through the eyes of the Composite Man and WB. I guarantee, for timing the turns in the market in real-time, you really can’t find anything better. Trust me I tried. If you need another quill in your quiver give me a try.
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