Market maker has shown their control out of the open.
The first play of the day is to run the stops behind the double bottom built after the cash close.
{quote} I use a method called Center of Gravity bases on opening range together with fib extremes Also very consistent and rewarding Maybe i will start my win thread Example from yesterday {image}
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Fantastic Wbemsms! Please start your thread. I would be interested.
Another weapon in the market maker tool box is the VWAP. I think your center of gravity system resembles or replicates their strategy to some extent, and that is why it is working so well. Once again, DAX is heavily manipulated. Once you can figure out a part, not all, of the market making algorithm, you can make yourself insanely rich.
Yesterday's price action has confirmed the bearish scenario that the balance on Wednesday was in fact a distribution.
I was anticipating a long liquidation the whole morning yesterday, hence didn't participate in many of the bounces from the morning support. The break finally came around 14:00, but I have already shifted my focus to US equity already by then.
From the TPO profile, we can see yesterday value was overlapping to the down side, with a bit of the buying tail, which appeared to be much stronger than its US counterpart. Let's whether DAX would be pulled to the down side in this session or not.
Note that we are trading below two and three days VWAP, which is to say, on average, those who has bought last two days are under the water. If the market presses, bigger long liquidation might become panic selling and when DAX wants to trade back to the high, those trapped trader would serve as an overhead supply. Hence the path of least resistance to go lower to stop those weak longs out before it can go higher.
The levels on the down side that I am watch is the TPO hole between 12530 and 12520, and the high volume node at 12512.
Trade well and think like a market maker.
The only way you can have consistence in DAX is to forget about your fancy tools, like Elliott wave or stochastic. But to understand their intentions of the market maker and trade with the market maker.
Of course, if it were to be able to take out the VAH at 12972.5, then it is possible that DAX is going to rip to the high.
That can happen only with the participation of the higher time frame players.
When they are in the market, you would know.
The retail traders might be wondering, why this is a rejection when the market looks still bullish.
It is the two day VWAP. DAX has been traded consistently below it. Each attempt to trade above it has been rejected.
What does it say?
The market maker is distributing their inventory.
Do you know what levels I am watching?
Yesterday's daily low. Because there are plenty of stops hiding behind that level.
The market maker is not going to leave that one untouched. Too sweat to leave it alone.
Do you know what levels I am watching? Yesterday's daily low. Because there are plenty of stops hiding behind that level. The market maker is not going to leave that one untouched. Too sweat to leave it alone. {image}
Divergence in DAX premium which could setup a short.
I don't have internals for Eurex, hence can only use the premium as a replacement to the TICK.
In principle, they should work similarly.
Let's see how it plays out.
The DAX has consolidated for 20 mins and then spiked to the upside. It has traded through the 2 day VWAP and traded the other side of the VWAP value zone. To me this is a bullish development.
If it is able to consolidate above the two day VWAP value zone which is between 12580 to 12560, it might just open the door to the break of the prior day's value and subsequently the prior day's high.
The catalyst is unclear to me, but that is also unimportant. I only trade the price and volume structure. I would listen to what market tells me.
Today might be the day of balance that the market maker runs the stops on both side of the market without any commitment to directional moves.
The developing profile is a balanced profile with the prior day's cash low being taken out and the spike up during the session was meant to take out the stops above the double top.
See how precisely it has touched yesterday's VPOC and turned around. This is telling me that most probably it is once again the market maker game being played instead of higher time frame player entering the market.
When doing the market prep, it is crucial to mark out the double tops and bottoms in the chart before hand. And also the magnet levels.
Those levels just draw in the price. Without an awareness of where they are, you are not going to read the intention of the market maker properly.
This morning I was so fixated on the raid of the double bottom at the low and forgot that there is a double top at the high and didn't define the magnet levels and resistance levels at the high, hence missed a proper short from yesterday's VPOC of 12590.
