Weekly commentary 31 Flashcards
How does a bullish candle form?
Open, low, high and close.
The open to the low happens very quick. Price then moves up to form a high. Price then moves from the high to the close of the candle.
What is the expansion of a bullish candle?
The movement from the low to the high is the expansion of a bullish candle.
How does a bearish candle form?
Open, high, low and close.
The open to the high happens very quick. Price then moves down to form a low. Price then moves from the low to the close of the candle.
When does the expansion of a monthly candle typically occur?
The expansion of a monthly candle typically occurs in weeks where there is lots of high impact, or red folder news events. This is typically near the middle or the end of the month.
Is there a correlation between the news event and the expansion of the monthly candle?
The news events are scheduled for the same time every month. This allows for the expansion of the monthly candle.
Why is the correlation between the news event and the expansion of the monthly candle important?
The correlation between the expansion of the monthly candle and the monthly news events is important as the bias for the monthly candle will feed into the weekly and daily bias, which must be used for intraday navigation.
What triggers retracements?
In a bullish market, price can retrace when it trades into a premium array. In a bearish market, price can retrace when it trades into a discount array.
What should we wait for in order to anticipate where price will retrace to?
We need to wait for a swing high or a swing low to occur before we can anticipate where price will retrace to.
Why are retracements important?
Retracements into PD arrays or OTE levels provide opportunities to get trades in line with the order flow.
What do we do to validate that a market structure shift has occurred?
When a market structure shift occurs, we need to validate it on a higher time frame, or rather, ensure that it is in line with the higher time frame bias.
Refer Example 1 – fake mss – in this example, there appears to be a bullish mss on the daily timeframe. On the weekly timeframe, it’s clear that this is in fact a run on buyside liquidity that lines up with an OTE. This is a strong indication that price will move lower.
What should we expect when we see a series of lower highs?
When we see a series of lower highs, we should expect a buyside liquidity sweep on 1 of them for price to move lower.
What should we expect when we see a series of higher lows?
When we see a series of higher lows, we should expect a sellside liquidity sweep on 1 of them for price to move higher.
What can we expect when bond prices move higher?
When bonds take sellside liquidity and moves higher, and the DXY moves higher as well, then we can expect risky assets like foreign currency and BTC and ETH to run lower.
What’s the first thing you need to look for, irrespective of the model you’re trading?
The 1st thing you need to look for is a run on stops.
