I forgot to point out one interesting item in my trade review today. This happened in today's price action, but don't get real excited as this does not happen everyday. I'm trying to study it and see what I can discover.
What is it
The Low of the Day came in, to the Tick, at twice the range of the price action within the first hour of trading. Above is a 5 minute chart of the ES emini. There are three bands on color that show on the chart behind the price action.
- The narrow green band, is a 32% to 68% range of the first 15 minutes of trading. I use it to help me determine early directional trades.
- Wide green band - represents the price range of the first hour of trading.
- Blue Band - Twice the range of the first hour of trading.
Check out that low. Interesting, but need to discover how to use this when it does happen. The reverse can be true as well. That is, a high can come in at twice the range of the first hour of trading. On a choppy go-nowhere day, the price action can stay within the range developed within the first hour of trading.
Trade Wise, Trade Well
John
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