Chapter 1 lesson 4 - quarterly shifts and open float Flashcards
Which time frames should you use for analysis?
Analysis has to be done on higher timeframes because there always has to be a bigger narrative, or a bigger context for a trade.
Top down analysis hast to start on a higher time frame. Anything below the 4h is for entries only
What do we expect in the middle of a quarter?
There’s generally a retracement in the middle of the quarter. Always consider the month you’re in, and where that month falls in the quarter.
What causes a shift in market structure?
In a bullish environment, when price breaks a previous high, then drops, but does not create a new low.
In a bearish environment, when price breaks a previous low, then goes up, but does not create a new high.
What is the open float?
The open float refers to the open interest within the market. It refers to the key liquidity points within the market, and what is being attacked.
What do you need to look at to determine the daily bias?
You need to look at what is being violated and what is being respected.
If lows are being attacked, and highs are being respected and rejected off, then you are bearish.
If highs are being attacked, and lows are being respected and rejected off, then you are bullish.
When should we expect a shift in market structure?
We should expect market structure shifts to happen around the quarterly areas, ie the start and end of the quarter.
Which quarters are significant for trading?
The last 2 quarters always make a significant run.
