Bullish Pre Market,
Prior Day Close/Pre Market Open Gap,
Prior Day High & Low DOL,
VWAP (MONTH),
Weekly Trading Summary (July 22, 2024)
Trade Details:
- Date: July 22, 2024
- Asset: /MNQ - Futures
- Trade Type: Short
- Pattern: Bullish Pre Market, Prior Day Close/Pre Market Open Gap, Prior Day High & Low Draw on Liquidity (DOL), Monthly VWAP
Trading Notes:
-
Pre-Market Analysis (8:38 AM)
- Observed an overnight gap above the prior month's low, indicating potential continuation higher due to in-the-money buy orders from Friday.
- Daily VWAP trending through its upper band.
- Monthly VWAP tracking on the 1D 5M chart showed alignment with prior day's high and low liquidity draws.
- Bias: Expecting a liquidity sweep above the prior day's high followed by a failure.
- No major economic news anticipated; expected selling into the open.
-
First Trade (9:45 AM)
- Short trade on the 2-minute chart, stopped out.
- Maintained the same thesis; looked for re-entry on the 5-minute chart.
-
Second Trade (M5 Re-Entry)
- Re-entered on the M5 chart based on Monthly VWAP Trend and Variation shift to the downside.
- Target: Weekly DOL after sweeping prior day's high DOL.
- Thesis: Expected overnight longs to cover positions into the open, creating sell-side pressure. Anticipated multiple traps (shorts and longs) to be sprung for a downside move.
- This setup was a playbook trade where a prior day close to pre-market open gap gets absorbed and traded against.
-
Mid-Trade Update (11:30 AM)
- Trade entered drawdown but moved in the expected direction.
- Covered 1 of the 2 contracts, holding the 2nd for the full Monthly VWAP upper band to lower band move.
-
End of Day (2:41 PM)
- The trade ended negatively.
- Targeting the DOL lower on the week and expecting the playbook trade to play out did not work as planned.
- Recognized the need to revisit this trade signal for future improvements.
Things Done Right:
- Identified and analyzed key support and resistance levels using VWAP and DOL.
- Maintained a consistent thesis and adapted to re-enter on a higher timeframe (M5) after being stopped out on a lower timeframe (M2).
- Managed risk by covering 1 of the 2 contracts during the trade.
Things Done Wrong:
- Initial trade on the 2-minute chart led to an early stop-out.
- Targeted a specific weekly DOL that did not play out as anticipated.
- The final trade resulted in a loss, indicating a need to reassess the trade signal and entry criteria.
New Key Rules Learned:
- Reassess Entry Criteria: Review and potentially adjust entry criteria when initial trades are stopped out to avoid repeated drawdowns.
- Signal Validation: Further validate trade signals to improve the accuracy of entries, especially for playbook trades.
- Risk Management: Continue refining risk management strategies, including partial covers and setting realistic targets.
By analyzing these notes, you can refine your strategy and rules, focusing on improving your trade entries, managing risk more effectively, and validating your trade signals for better future performance.
Its currently 8:38 AM as im beginning todays journaling session. And right off of the bat, there is an overnight gap above the prior month low. Which tells me that the buy orders hitting the tape on friday, could very well be in the money for todays trading session for a continuation higher. And since the 1D VWAP is trending through its upperband. I decided to take the next deivation, which actually happened to be the Month VWAP tracking on the 1D 5M. There is also a draw on liquidity for both the high and the low of the prior day. And it aligns pretty well with the Month VWAP bands. So what Im thinking is going to happen, is that there will be a liquidity sweep above the prior day high, and we will see a failure, after the liquidity is swept. That is my current bias. There is no major economic news today either, and I would figure that there should be some selling into the open.
9:45, was just stopped out of an opening short trade on the 2 minute chart, still have the same thesis, will re enter if presented on the M5 chart
I re entered on the M5 Month VWAP Trend And Variation shift to the downside. Targeting the weekly dol after the prior day high dol was swept. I am currently risking another squeeze to grab more buy stops on what I believe is a manipulation trade up. My thesis is that the overnight longs will be covering their positions into the open session here, creating sellside pressure, and that the manipulation up, will have trapped early opening shorts, and also create a false breakout to the upside for longs, trapping them on the way back down. So, theres multiple traps involved in this setup. And it follows our playbook trade, backed by data, where a prior day close to pre market open gap gets absorbed and traded against. So, we will see what happens. Ive made more money to the downside as well than my long trades. If it doesnt work, it is what it is.
11:30, The trade put me into some drawdown, but It is currently in my direction, and I covered 1 of the 2 contracts. Going to attempt to hold the 2nd one for the full Month VWAP Upperband to Lowerband move.
2:41PM Red fucking day. What else is new...
I was targeting the DOL lower on the week, and for the playbook trade to play out, and it didnt. Will have to revisit this incorrect trade signal in the future.
