London session market profile preps and journal for DAX

What a beautiful maneuver in DAX again. The market maker definitely worth a round of applause that they were able to convince a boat load of retail investors that the DAX is going to make a new high very soon (including me). This group of hopeful pullbacks buyers are all trapped. Some of them have already puked. Yesterday around 12850 I have seen a stop of of 80 contracts being puked and absorbed by the market maker. He who has puke would be grateful that he has puke around 12850 because now DAX is trading around 12650. Do the math how much more paper loss he is going to inflict if he choose to stay on.
Given the pullback buying speculative long position built from 12950 to around 12800, the market maker has no interest in giving them a refund (break even exit) by trading up to in the vicinity of that level. The path of least resistance is to trade lower to probe the stops behind the 12600 low, where even more inventories will be puked. Now the situation is a typical DAX one, it has to go down first to clean the book before it can go up. Brace for impact, traders!

My daughter is sick.
Wont' be able to trade DAX actively today.

The theme of yesterday was testing supply at 12580 below the prior support 12600.
After several tests attracting less and less supply, the market maker decided it is time to turn it around.
After that the consolidation above 12580 ensued and value is built around 12650.

Today DAX should be able to maintain its bullish stance when other equity indices are bullish.
Also the value and volume built at the 12580 low has been bigger than the overhead supply of the weak longs trapped on Monday, which is to say, technically, it is ready to challenge the 12800 area.

In today's session, I would like to see the 12700, 12680 being re-tested before taking the final assault to retake 12800.

DAx yesterday has failed to capture 12750. And the longs liquidated position before the NY session.
Hence the NY session was just a side way's drift and a test of 12650.

So far today DAX had a failed attempt at breaking 12700. The path of least resistance is go back to retest 650.
If not hold 620.
My daughter is still in the way of my trading. No active session again.

From this 240min chart with monthly TPOs, it is really clear that the DAX had its double top formation in place and confirmed by yesterday's decisive break of the neckline at 12523.

There are two scenarios from this point on,
1. race to 12300 low made on Apr 24th in one breath
2. Retrace high to fill some TPO holes above 12750 (take out some stops of the short sellers) before resume to the down side.

To me the second scenario is more likely as the selling of the yesterday's overnight session was merely a forcing action not real money selling. Get above 12520, the short covering is going to take us very quickly to 12620.

Can't take out 12520.
It might have to back test 12480 first.

Support from 12495.
It is a good break out.

Weekend prep and trade plan for the next week:
General guidance:
As a matter of fact of my time constraints, I will trade much less in the active intraday style in DAX. Instead, i am going to focus more on trading swing setups in the currencies and US equities. I want to limit the time spent on day trading so that I can do some coding and learn some new skills. Therefore I am going to focus primarily on trading the spring setup from a significant technical level. I would not engage anymore in the middle of a trading range or some random trade location.

1. EURUSD:
EURUSD has just broken out to the above of a one-week-long fallen wedge. The wedge is made even more powerful as the May 29th low has been run deliberately and reversed very quickly. This setup is called spring in the Wyckoff terms, or breaker in ICT's term, or look-below-and-fail pattern in ShadowTrader's terminology. Anyway, it is one of the most powerful and reliable setup that I have traded. Usually it signifies a major swing reversal point. The power of this setup comes from the fact that the stop run and reverse is a sign that some big institute is buying a gigantic amount so much so that they would have to trigger a massive amount of stop loss to find the counter party to take the other side of their buy orders.

The price has quickly traded through the whole width of the fallen wedge on the back of strong short covering demand on Thursday. On Friday, it has found the first level of resistance at 11750 high volume node (this is referring to the levels in the futures contract). Hence Euro has consolidated and formed a balance. From Friday's TPO profile, I can see that Euro has found support above the Monday high, the path of least resistance is to trade to the upside. After taking out 11750, there is not much of resistance until 11820.
If on Monday, the Euro were to break below Friday's POC level at 11715, then it might retrace lower into the value area of last week to find support. I would be interested in buying from 11660 (referring again the futures price) to 11620. Below 11620, I would step aside to see what the euro really wants to do.

OK, let us recap the trade plan:
1. The directional bias in the swing time frame is to the upside aiming at, at least, a test of 11820 level;
2. First long scenario is to use Firday's balance as jumping board to build a long position in the anticipation of the break of 11750 level
3. If the first scenario were to fail, we fall back to the POC of last week and below as the buy zone.
4. If the Value area low of last week 11620 were to break, step aside as it might make a new low.

2. GBPUSD:
The Pound has a similar structure to that of Euro. The only difference is that the stop run has been much deeper and it has tested last year's POC.
It has snapped the multi-day losing streak in such a ferocity that all the short sellers are stunned and trapped. If the Thursday gap is not closed very quickly early next week, then the path of least resistance is to go with the gap and trade to the upside. As of Friday close, Pound closed below Friday's value, hence it is very likely that Pound would trade lower to wash out the weak long and find buyer lower. If 13280 does not hold, then 13230 gap fill is in play.
If it were to open above Friday's value, then I would use Friday's balance as the stepping stone to trade Pound higher.

The Euro setup has been working out as we expected. It is reasonable to expect some pullback before shooting higher if the Euro bulls would allow.

The DAX might be quite broken on the long term chart, but it has shown sign of strength that it is able to trap a lot of shorts in the hole and hold high.
Now DAX is forming a bullish continuation pattern. A break would confirm the short term bullishness.
The likely target is to test 12450 the last week's low.

Too much selling at the daily pivot 12340.
Pulling back lower to build energy.

Consolidation through time.
First half hour value is placed at 12310.
Up bullish, below bearish.
If break below, would have to go lower to find buyer.

It is highly likely that we are going to trade though the low volume area from 12300 to 12270 very quickly.
The buyers failed to break the top and we are heading for a wash out.

Some strength appeared.

Support appeared from 12380. But I would reckon it could go a bit lower to 12275, which is the 61.8 retracement of the whole bounce.

6B:
Last Friday's POC are well protected capping pirce below. After two days of failed attempt to break that level, technically there is a demand for Pound to look below Monday's low and fill some gaps left on last Thursday's trading.

6E is much bullish by looking at the TPO chart.
But after two days of overlapping higher Value Areas, there is a technical demand of deeper correction to shake off the weak long holdings.

which way will the 6E end up to go?



rejected by yesterday poc

What a great chart you have now.
I like the VWAp std dev band you have in your chart.

really! you are probably refferring to the choice of summertime colours ....
I wish I could build with the free DValueArea indicator the weekly MP chart you posted on 6E a couple of days ago, but it appears it does not allow to do that.