1D M1 VWAP, 1D M2 VWAP, H12 Bearish LIS, H6 Bearish Trend, Lower DOL, M1 Entry, M2 Entry Loss, Mo Bearish Trend Shift, VWAP Short,

Key Takeaways from Today's Trade of the Day Setup

1. Trend and LIS Analysis:

   • Entered a long trade during a setup that should have been taken in the opposite direction.
   • Misalignment due to the H6 trend not flipping, which is crucial for counter-trend trades into the H12 LIS.
   • The trade would not have been executed if the H6 trend flip was awaited, avoiding the incorrect long entry.

2. Timeframe and Execution:

   • The trade of the day setup played out on the 1D 1M VWAP middle band, suitable for 1-minute and 2-minute chart execution.
   • Chose the 5D 5M WEEK VWAP for the trade based on a prior successful trade at the upper band extremity.
   • Misjudged the lower band extremity as a high possibility for a swing low hold and bounce.

3. Volatility and Price Action:

   • Experienced tricky price action with significant volatility.
   • The draw on liquidity was lower following the monthly trend shift, which should have been factored into the analysis.

Adjustments and Rule Implementations

1. Counter-Trend Trade Rule:

   • New Trading Rule: To execute a counter-trend move into the H12 LIS, the H6 trend must be counter-trend to the H12 directional bias/trend.
   • This rule ensures alignment and avoids premature counter-trend entries.

2. Trend Confirmation:

   • Always wait for trend confirmation on the H6 chart before executing trades against the prevailing H12 trend.
   • This confirmation helps in avoiding trades that go against the overall market direction.

3. Timeframe Consistency:

   • Execute trades on appropriate timeframes that align with the identified setup (e.g., 1D 1M VWAP middle band for 1-minute and 2-minute charts).
   • Avoid using custom or less relevant timeframes that could lead to misalignment and increased risk.

4. Price Action and Volatility Consideration:

   • Factor in recent trend shifts and the potential impact on price action and liquidity draws.
   • Stay cautious of tricky price action and avoid making trades based on assumptions without confirmation.

Summary of Adjustments and New Rules

1. New Trading Rule:

   • For counter-trend trades into the H12 LIS, the H6 trend must be counter-trend to the H12 directional bias/trend.

2. Trend Confirmation:

   • Wait for H6 trend confirmation before taking trades against the prevailing H12 trend.

3. Timeframe Consistency:

   • Use the appropriate timeframes for trade execution based on the identified setup.
   • Avoid relying on custom or less relevant timeframes.

4. Price Action Awareness:

   • Be aware of recent trend shifts and their impact on liquidity and price action.
   • Exercise caution in volatile markets and avoid trades based on unconfirmed assumptions.

By implementing these adjustments and rules, you can improve your trading accuracy, avoid misaligned trades, and enhance your overall trading performance.

 

 

 

 

Today we took a long at the exact moment this 'Trade Of The Day' Setup played out. So i got in the wrong direction at the exact moment I should of went the other way.

The reasons I think I got this trade wrong, was mainly because, the H6 trend never flipped, which seems to me now, to be a major factor with my H12 LIS thesis.

***NEW TRADING RULE***

In order to play a counter trend move into the H12 LIS, going against the prevailing directional bias as we state in our 'Line In The Sand', the H6 trend must be counter trend to the H12 directional bias/trend.

__________________________________________________________________________________________________________

I believe if I had waited for the H6 trend to flip, it would have kept me out of the long side trade, because the long order would have never got filled, and I could have located the counter direction move and looked for levels and opportunites according to it. 

The trade panned out on the 1D 1M VWAP middleband. And the trade could have been executed on both a 1 minute & 2 minute chart.

I executed the trade on a 5D 5M WEEK VWAP, because the prior day, I had an amazing trade that came from the upperband extremity, and today we were trading the lowerband extremity, and I thought there was a high possibility that the swing low would hold, and that we would bounce. It was very tricky price action. 

And the draw on liquidity was lower after the monthly trend shifted. 

H12 Bearish LIS, M1 Bearish Orderblock, M15 Bearish Orderblock, M15 Bullish to Bearish Variation, M30 Bearish Orderblock, M30 Bullish to Bearish Variation, M5 Bearish Orderblock, M5 Bullish to Bearish Variation, No VWAP Extremity, Playbook , Trade Of The Day , wrong bias otd,

Refined Notes

Loss Analysis and Key Takeaways

$600 Loss Overview:

• Missed a massive supply zone near the H12 LIS (Line in the Sand).
• The supply zone ran through M1, M5, M15, and M30 order blocks from the LIS.

Technical Analysis Improvement:

• New Rule: Mark untapped supply and demand areas on the H12 lines in the sand, highs, and lows to avoid missing future entries.
• Cannot solely rely on VWAP Band extremities or the first VWAP area when the market opens in the middle of nowhere.

Entry Criteria and Strategy Adjustment

Order Block Analysis:

• Mark Prevalent Order Blocks: In the direction of the LIS, identify and mark the most relevant order blocks.
• Timeframe Correlation:
  • For each order block, wait for the reaction on the corresponding timeframe.
  • Example:
    • For an M30 order block, wait for an M30 reaction.
    • For an M15 order block, wait for a 15-minute reaction.
    • This applies similarly to M5, M1, etc.
  • Enter only when the price action reaction aligns with the order block's timeframe.

Chart Adjustments:

• Immediately start marking order blocks on charts to avoid relying solely on VWAP bands.

End of Session Reflection:

• The session ended with a bounce from the prior daily order block.
• This bounce was in confluence with:
  • 90-day 61.8% Fibonacci level.
  • Monthly ODB (Order Block).

Fibonacci Confirmation:

• 90D Model Layout:
  • Use the 90D Fibonacci with the 180 H4 default timeframe, which encompasses the swing low to high.
  • Use H4 confirmation to take trades.

By implementing these refined strategies and rules, future trades can be more accurately executed, reducing the likelihood of missing significant market signals and enhancing overall trading performance.

 

 

 

 

4o

 

 

 

 

So I had a $600 loss today, and I just had to go over it with a fine tooth comb and see what I missed. And clearly enough, There was a massive supply zone near the H12 LIS that I completely missed, and that ran from the M1, M5, M15 & M30 Orderblocks from the LIS. 

So from now on, when I am doing technical analysis. Any H12 lines in the sand, Highs & Lows, I will now mark the untapped Supply & Demand areas, so that I wont miss another entry like the one provided today. Because clearly, I cant just solely rely on the VWAP Band extremities, or the first area of VWAP to play off of first when the market opens in the middle of nowhere.

The rule will be that I will mark the most prevalent orderblocks in the direction of the LIS, but the orderblock timeframe, must correlate with the price action reaction entry model.

So for example, if we have an M30 Orderblock, we wait for the M30 reaction, If we have a M15 Orderblock, we wait for the 15 minute reaction, same applies to the 5M, 1M etc. Any orderblock that we play, must have correlating timeframe price action reaction to enter. I will have to start putting these on my charts immediately so that I dont just solely rely on the bands. 

So the session today ended with a bounce of the prior daily orderblock. Also in confluence with the 90D 61.8% fibonacci & Month ODB For this fibonacci confirmation, since I do not yet have a layout for a 90D model, I will use the 90D fibonacci, with the 180 H4 default timeframe, since it is the next timeframe up that encompasses the swing low to high. And I will use an H4 confirmation to take the trade. 

DOL higher reversal, H12 Bearish LIS, M1 Entry Loss, M15 Entry Loss, M2 Entry Loss, M30 Entry Loss, M5 Entry Loss, Prior Day Untapped LowerBand Failure, Volume Increasing On Open, VWAP failure, VWAP Lowerband Failure,

Key Points from Notes (Refined)

Trading Session Reflection (11:39 AM)

• Massive Loss: Significant red day with a large blow to the account.
• False Signals: Every buy signal received was a false signal.
• Market Behavior: Market dropped unexpectedly with expanding volume on the open.
• Liquidity Draw: The draw on liquidity higher was the next H12 candle high.
• VWAP: Prior day untapped Lowerband on the daily VWAP did not provide a bounce; even premarket movement was manipulated.
• Rule-Breaking:
  • Did not follow the sizing plan (only 1 micro).
  • Did not adhere to the M5 chart trading timeframe plan.
  • Ignored the rule of moving to the next higher timeframe when incorrect on a trade.
  • Resulted in a loss bigger than it should have been.
• Psychological Impact: Felt market was excessively extended to the downside, leading to larger positions.
• Future Considerations:
  • May switch to trading the S&P500 due to NASDAQ volatility.
  • Need to decrease risk on trailing drawdown until recovery.
  • Wider stop losses required when moving to the next higher timeframe.

Loss Analysis and Future Strategy (3:10 PM)

• Persistent Failures: 30M and H1 long signals also failed; unprecedented failure of long signals throughout the day.
• OTD Analysis: Need to analyze how to anticipate such trades in the future.
• Key Observations:
  • H12 bearish LIS (Line in the Sand) to start the trading session was the only indication of a sell-off.
  • Typically expect a run on the LIS to the upside first, followed by a sell-off, which did not happen today.
• Signal Grouping: To prevent future false signals:
  • Short Term Timeframes: 2 Minute, 5 Minute, 15 Minute.
  • Medium Term Timeframes: 30 Minute, 1 Hour, 2 Hour.
  • Long Term Timeframes: 4 Hour, 6 Hour, 12 Hour.
  • Rule: If 3 losses are taken in a row on the same trade idea within any timeframe grouping, stop trading for the day or change the trading thesis.

Additional Reflection (12:52 PM)

• Market Movement: Reached the lower weekly DOL and continued towards the lower prior monthly DOL.

Refined Entry Criteria for Using the Middle VWAP Band

1. Market Context:

   • Range-Bound Market: Use the middle VWAP band for potential mean reversion trades.
   • Trending Market: Avoid using the middle VWAP band as a primary entry point in strong trends.

2. Volume Confirmation:

   • Look for significant volume around the middle VWAP band to confirm the strength of support or resistance.

3. Time Frame Alignment:

   • Ensure the middle VWAP band aligns with support/resistance levels on higher time frames.

4. Price Action Signals:

   • Use candlestick patterns like pin bars, engulfing patterns, or inside bars at the middle VWAP band to confirm potential reversals or continuations.

5. Additional Indicators:

   • Combine the middle VWAP band with indicators such as RSI, Moving Averages, or Bollinger Bands to filter out false signals.

Entry Signals

1. Volume and Price Action:

   • Volume Spike: Look for a spike in volume coinciding with the price reaching the middle VWAP band.
   • Candlestick Patterns: Monitor for bullish or bearish reversal patterns at the middle VWAP band.

2. Multi-Time Frame Analysis:

   • Ensure the middle VWAP band aligns with support/resistance levels or trendlines on higher time frames.

3. Indicator Confirmation:

   • RSI Divergence: Look for RSI divergence at the middle VWAP band.
   • MACD Crossover: A MACD crossover near the middle VWAP band can signal a potential entry point.

4. VWAP Band Interaction:

   • First Test: Give more weight to the first test of the middle VWAP band after a significant move.
   • Multiple Time Frames: Confirm that the middle VWAP band is respected on multiple time frames.

Example Trade Setup

1. Price Approaches Middle VWAP Band:

   • Volume increases, indicating potential support/resistance.
   • A bullish pin bar forms at the middle VWAP band on the 5-minute chart.

2. Confirmation from Higher Time Frames:

   • The 15-minute chart shows the middle VWAP band aligns with a previous support level.
   • RSI on the 5-minute chart shows bullish divergence.

3. Additional Indicator Confirmation:

   • MACD crossover on the 5-minute chart supports the bullish reversal.

4. Entry:

   • Enter a long position as the next candle confirms the bullish pin bar.
   • Set a stop loss just below the middle VWAP band and the recent swing low.
   • Set a profit target based on risk/reward ratio or at the next VWAP band level (top band).

By refining your criteria and combining multiple signals, you can enhance the reliability of using the middle VWAP band in your trading strategy. This approach helps filter out false signals and increases the probability of successful trades.

 

 

 

 

11:39AM. Massive fucking red day, massive blow to the account, every single buy signal I got was a false signal. Market dropped in the center of nowhere, volume was expanding on the open, the draw on liquidity higher was the next H12 candle high. Complete fucking joke of a day, and honestly. I dont even know what I would do differently. 

Prior day untapped Lowerband on the daily VWAP didnt provide a bounce at all, it did slightly in the premarket but even that move was manipulated. 

I also broke many many rules, almost didnt follow anything. Didnt follow my sizing plan. of only 1 micro. Didnt follow my timeframe plan, of only trading the M5 chart. didnt follow my rule of going to the next timeframe higher when Im incorrect on a trade. Loss is way bigger than it should have been. It just felt like the market is so overexaggeratedly extended to the downside that it was baiting me into bigger size. 

But because of this massive false signal, and the loss of almost half my drawdown. I may switch to trading the S&P500 tomorrow because its less volatile. I simply cannot afford to trade NASDAQ if its going to move this much. Its moved -360 points to the downside somehow. And with the timeframe stoplosses that I require, I have to decrease my risk on my trailing drawdown until I get out of this hole. 

The issue is that if I follow the rule of going to the next higher timeframe, then I have a way wider stop with the bigger candles. I would have taken a massive hit on the M15 short long extry signal because the next candle was completely engulfed. 

as it stands right now, we are going to need at least 30M confirmation to take any longs on nasdaq in the future. This loss on the day was completely unacceptable, and we have to do everything we can to make sure this doesnt happen again.

3:10PM Just came back to my trading journal to write under this statement ^^^^^^. The 30M long signal also failed. As well as the H1 long signal. This is unprecedented, virtually every long signal on the day for me failed. So the most important thing I will need to do OTD is go back to figure out how I could have anticipated this trade

The only tell that this trade would sell off OTD for me currently is the H12 bearish LIS to start the trading session. The only issue with this, is that in the past, we have usually seen a run on the LIS to the upside first. and then come down. Thats the type of move I was anticipating today, a move higher from open, until 1PM sell side was offered. I was not anticipating this heavy of a drop from open. And it basically was like trying to buy the next floor and taking an elevator down everytime. 

In order to prevent this many false signals again in the future, we will group the trade signals

(Short Term Timeframes)

- 2 Minute

- 5 Minute

- 15 Minute

(Medium Term Timeframes)

- 30 Minute

- 1 Hour

- 2 Hour

(Long Term Timeframes)

- 4 Hour

- 6 Hour

- 12 Hour

If 3 losses are taken in a row on the same trade idea within this timeframe grouping. I must stop trading on the day, or change the trading thesis.

12:52PM. It just reached the lower weekly DOL and is still continuing to head for the lower prior monthly DOL.