Today started of with the assumption that price and value will drop. Yesterday we topped out at the important level of 3820/3822 swing level high from 10/5. This was an open auction day that did not look back or retest.
The IB also only brought in 1600 new contracts only, a very anemic level. Additionally, there was no big overnight inventory. We opened in range but slightly above yesterday’s value at 3808.75. The first trade I took at 6:33 was a short at 3821.75 (yesterday’s high) which got stopped out pretty quickly. Sell @ 3819.25 and Buy at 3821.75. This trade was rushed and based on the analysis from Hoag who always tries this. I lost 12 ticks. The open trade was not interesting because the range was beyond 5 points.
The above is a good trade entry for a long around the major infliction level 3820. At that level there was a .619 fib retracement and then two stacked imbalances favoring a long. Waiting for the second stacked imbalance would have led to a loss of trade location since after that the candle just took off. Entering a long trade in the middle of the after the first stacked imbalance would have led to good trade location and acceptable risk. The fib retracement at 6:40 would have been an even better trade location.
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