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Lock's Cable Corner

  • #2,621
  • Jan 19, 2017 6:53am Jan 19, 2017 6:53am
So, pit US opened inside yesterday pit range, consequently in a balance situation. Overnight inventories are almost 100% long. So we are in case 1. Let's see if it will correct some of them or not. If not the market is strong. If the correction will occur the market is neutral initially or even weak. Confidence is very low because as you see price is up and down open level. And the fact that pit opened in balance is also a signal of low confidence. Consequently we got to moderate our expectation. At least initially.
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  • #2,622
  • Jan 19, 2017 7:02am Jan 19, 2017 7:02am
First confirmation of the weak environment: A and B lows both at yesterday pit open, exactly.
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  • #2,623
  • Jan 19, 2017 7:43am Jan 19, 2017 7:43am
B and C highs both at half back, as C low at yes open... And note that we got no liquidation of overnight inventories in the first 3 pit periods.. Consider the situation of pit participants: they have the possibility to squeeze overnight week hands and they don't. Why?
There are 2 possibilities here: they are weak too and consequently they have not the strength to do this job, or they are strong and they do not want to. Now, if they were strong, why they stop twice at half back and buy exactly at yesterday open? So in my opinion we got weak hands also in this pit session. So weak that they cannot even correct overnight.
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  • #2,624
  • Jan 19, 2017 7:46am Jan 19, 2017 7:46am
Quoting Lock
B and C highs both at half back, as C low at yes open... And note that we got no liquidation of overnight inventories in the first 3 pit periods.. Consider the situation of pit participants: they have the possibility to squeeze overnight week hands and they don't. Why? There are 2 possibilities here: they are weak too and consequently they have not the strength to do this job, or they are strong and they do not want to. Now, if they were strong, why they stop twice at half back and buy exactly at yesterday open? So in my opinion we got weak hands...
So, what is the purpose of my comment? To stress the importance of preserving our own capital in a situation clearly very weak and uncertain. Most of traders place their positions regardless of the environment's conditions: this behavior is one of the main reason of their losses.
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  • #2,625
  • Jan 19, 2017 7:53am Jan 19, 2017 7:53am
Quoting Lock
So, pit US opened inside yesterday pit range, consequently in a balance situation. Overnight inventories are almost 100% long. So we are in case 1. Let's see if it will correct some of them or not. If not the market is strong. If the correction will occur the market is neutral initially or even weak. Confidence is very low because as you see price is up and down open level. And the fact that pit opened in balance is also a signal of low confidence. Consequently we got to moderate our expectation. At least initially.
In this comment I use the terms "strong", "weak" and "neutral" as "long, short and neutral" bias. So when I say strong I mean that if pit does not correct overnight inventories probably there is some long bias underneath, vice versa if pit does correct ON inv. is the opposite or neutral. I stress this in order to avoid confusion. Now, a long or short bias could be strong or weak obviously. It depends upon who are the market participants.
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  • #2,626
  • Jan 19, 2017 8:08am Jan 19, 2017 8:08am
The only thing I can say today is: "I'm getting very nervous of this market behaviour....."
You can manage risk, but you can't manage the return
  • #2,627
  • Jan 19, 2017 8:22am Jan 19, 2017 8:22am
Quoting HappyMe
The only thing I can say today is: "I'm getting very nervous of this market behaviour....."
In order to avoid this psychological condition you have to accept what market is telling you: what about your initial expectations? They should have been low considering the fact that pit US opened inside yesterday range, went up and down open price multiple time, used very exact references to trade. In such environment you simply have to do nothing or play with your demo. Maybe you are going to lose a big trade: it's possible. But, so what? Most of the times if you will accept market generated infomation you will be on the right side of the game. If not, maybe you could be lucky sometime but on the long run you'll lose your capital, financial and psychological.
So stay calm and do nothing unless some change will occur. And if you already lost some, do nothing again and wait exactly in the same manner. Maybe nothing is going to happen and you'll not cover your losses today: again, so what? Sometime markets do not cooperate. You'll do better tomorrow, or the next week. But, in any case, do not let anger enter in this game: it has nothing to do with market.
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  • #2,628
  • Jan 19, 2017 8:34am Jan 19, 2017 8:34am
Now, we got a poor high cluster. Today pit session is inside yesterday pit session range as today pit session value is inside yesterday pit session value. the same thing happened with GB session. So: we are in balance a full vary narrow balance. Balance rules apply here. Do something only if price will go at the top or the bottom of the inside balance. If not, do nothing because nothing is happening.
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  • #2,629
  • Jan 19, 2017 8:45am Jan 19, 2017 8:45am
Quoting Lock
Now, we got a poor high cluster. Today pit session is inside yesterday pit session range as today pit session value is inside yesterday pit session value. the same thing happened with GB session. So: we are in balance a full vary narrow balance. Balance rules apply here. Do something only if price will go at the top or the bottom of the inside balance. If not, do nothing because nothing is happening.
If it will break, go with the break and monitor for continuation. If it fails at one side, natural initial direction is the opposite side of the balance. Do not anticipate the break. After the break you want to see acceleration, not a stall of price action. Also, try to use a smaller balance to perform the entry: the risk will be smaller too and if it will work you'll get an asimmetric opportunity.
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  • #2,630
  • Jan 19, 2017 9:03am Jan 19, 2017 9:03am
Hi Lock!
These are the balance rules?

Quoting Lock
{quote} If it will break, go with the break and monitor for continuation. If it fails at one side, natural initial direction is the opposite side of the balance. Do not anticipate the break. After the break you want to see acceleration, not a stall of price action. Also, try to use a smaller balance to perform the entry: the risk will be smaller too and if it will work you'll get an asimmetric opportunity.
  • #2,631
  • Jan 19, 2017 9:05am Jan 19, 2017 9:05am
E inside D. (little balance)
E and F lows at open price(23117). D low at half back (2303). A D E highs=cluster poor high (23315)

Quoting nixdem
Hi Lock! These are the balance rules? {quote}
Hi Nixdem, yes they are. Best L.
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  • #2,632
  • Jan 19, 2017 9:22am Jan 19, 2017 9:22am
Quoting Lock
E inside D. (little balance) E and F lows at open price(23117). D low at half back (2303). A D E highs=cluster poor high (23315) {quote} Hi Nixdem, yes they are. Best L.
All taken out. And then watch out if there will be no continuation downside, because we got weaknesses still left above at the opposite side of E (little balance)
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  • #2,633
  • Edited 12:01pm Jan 19, 2017 11:50am | Edited 12:01pm
Quoting Lock
E inside D. (little balance) E and F lows at open price(23117). D low at half back (2303). A D E highs=cluster poor high (23315) {quote} Hi Nixdem, yes they are. Best L.
Quoting Lock
{quote} All taken out. And then watch out if there will be no continuation downside, because we got weaknesses still left above at the opposite side of E (little balance)
No continuation downside and here we are back above A D E periods' highs cluster: 23315 tagged and taken out.**

**actually the cluster is at 2328 and for some reason I typed 23315 that is the vip GB reference just above the cluster. Anyway the important thing is that the cluster has been removed
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  • #2,634
  • Jan 19, 2017 12:10pm Jan 19, 2017 12:10pm
Quoting Lock
{quote} When it failed above it and below the yesterday GB high I went short again. Sincerly it was not easy. At all. Now let's see if it is able to retrace D and take out the half back weaknesses at 23085. G high is obviously weak as it is a perfect tag of yesterday GB high: carry this information forward if something will go wrong downside.
Also GB G period high tagged: now it is weaker than before.

Note that current pit session is still inside yesterday pit session range as its value is still inside yesterday pit value. Actually there is no way to move the value higer from here because the pit session left only 3 periods plus the current one and the poc is 9 letters wide. Anyway it could continue higher as it is currently trending and in a trend environment price anticipates value.
Whatever, cos I'm really tired right now, I'm off. Let's see tomorrow. Have a nice continuation. Best L.
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  • #2,635
  • Jan 19, 2017 11:50pm Jan 19, 2017 11:50pm
17/01/20 FRIDAY 08:50 +1GMT
EARLY MORNING REPORT

We are in a monthly balance, in a weekly balance and in a short term daily uptrend because the last 4 days have been in one time framing higher mode. At the same time we are in a multi session balance, as yesterday, as already written, we got an inside GB session (22795-2341). Furthermore yesterday GB session is inside Wednesday GB session that is inside Tuesday GB session. Also the pit session is in balance because yesterday pit is inside Wednesday pit range.

Now, this initial assuption is very important today because we have the possibility to open outside balance (above yesterday GB range high at 2341 or in balance, if open will below that level. If out of balance our expectation could be bigger, because 2 things could happen in this case:

  1. a continuation above balance, meaning that we are in a breakout upside;
  2. or a retracement inside balance and in this last case our initial direction will be the opposite side of yesterday GB range at 22795. In this second case also we have space for a continuation below yesterday GB range low. Why? Because starting from above yesterday balance means that we already tested above it, so the action downside could be more "secure".

Now, if instead we are going to open inside yesterday GB balance, our initial expectation should be smaller: because it will mean that price will be in balance, meaning a substantial initial acceptation of yesterday prices. Having said this, if GB will open in balance we could do 3 things:

  1. Remain in balance for the third time in a raw.
  2. Trying above or below and fail (next target after the failure is the opposite side of the balance).
  3. Trying to go above or below and succeed, and in this case we will be again in a breakout condition.

Note that we have weaknesses above and below:

  1. above: 2 pit session poor highs above at 23425 and 24145
  2. below: 2 back to back Tokyo session poor lows at at 23285 and 22325 (this last one is also a pit session poor low tag)
  3. and again below: a GB session poor low at 2113 and an other one at 2018 (between these two GB we also gave a pit poor low at 2037)

So overall we got more weaknesses left downside: carry this information forward if it will remove the weaknesses above first and then if we will not find acceptation above them, because in this case after the "cleaning" of the upper weaknesses we could find space for a substantial correction downside.

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  • #2,636
  • Jan 20, 2017 12:45am Jan 20, 2017 12:45am
Note the struggle to test above multi session GB balance: most of traders have no idea of what is going on here. THose who know and understand market generated information have.
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  • #2,637
  • Jan 20, 2017 1:37am Jan 20, 2017 1:37am
Did you see the importance of market generated information? You got a huge edge knowing that GB was testing the multi balance high. because after the failure above it you know exactly where the natural direction was. And you had a wonderfull spot to sell when price came back inside yesterday GB range, also with a very little risk, putting your stops right above that level (yes GB high)

Now, again: monitor for continuation. First of all current D is very elongated. Second: you want to have acceptation below yesterday Gb unch at 23213. Third: the best thing for continuation could be a double distribution, soo you should not see the minus development left by current D completely filled. Then, you want to see a test accepted below the GB multi balance range low(22705 Wednesday GB low): if instead you will not see it or after it you will not see acceptation below it, watch out for a possible furter correction upside. Remember that this market is a continuous two ways auction process.
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  • #2,638
  • Jan 20, 2017 1:57am Jan 20, 2017 1:57am
Note also taht yes GB close is at 2300: you want to have acceptation also below it.
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  • #2,639
  • Jan 20, 2017 1:59am Jan 20, 2017 1:59am
A little poll here: did you get the short opportunity at the top of the multi balance? Like this post if so.

I count 22 readers right now: no one got that short?

It looks like nobody got it. So, please: if you like, write down what you did there. It could be a very important information for a lot of traders. Then I'll try to explain a possible approach to such a situation.
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  • #2,640
  • Jan 20, 2017 2:09am Jan 20, 2017 2:09am
Lock - Great observations, however I think that drop was due to the figures that came out at 09:30 that where below expectations

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