How To Engage Price After Holiday Volume Days transcript

Good morning, son. How are you? >> Good morning, Dad. I'm doing well. >> All right. We got the opening bell here. We've got about a 100 handle premium gap opening. We've got the key we're using Friday's first business of everybody got. If you look at the where we settled at, here's our gap. There. To there and mid gap. There, so August 28th first business of everybody got. So, we'll look to see if there's any reason for it to want to get down to that.

Watching half this wick. I'll toss one in on that. I'd have to stop at the wick high. Of course. >> [clears throat] [snorts] >> I'm going to look for that and the stop loss will go just above the second wick high. I'm going to aim for this sell-side right there. It's inside that wick. And volume imbalance [clears throat] at both ends, so that's a suspension block. So, there's the business on that. And it's a discount array, so we'll look at it like that.

Remove the risk. So, there's half gap filled. And down into that suspension block high. Let's take a quick look at ES. So far, Nasdaq is the softer of the two. So, not bad. Not bad at all. >> After a holiday, I like to go in with like one contract and just test it out. We're in paper trading this morning, so that way for disclosure's sake, everybody watching, they can stop worrying about counting pennies. This helps me get in alignment with price.

Either I'm offside or I'm onside with my initial expectation. So far, everything's brilliant. Uh, I think the girls got one second. Now, all of this sibi, I want to see some of that state open even if it retraces a little bit deeper. I'd like to see some of it just remain completely un tested at all. So, if we divided that sibi here with the volume imbalance low, there's consequent encouragement of that. So, there's liquidity resting right below that low.

And right there, and then full gap closures here. Never market replay. And there it is. Oops, I didn't have the I didn't have the executions on. I apologize. It's always There's the fill. Gap. Right here. See? And then we ran buy side first. Premium gap opening where we opened here at 9:30. Pull down half the gap. And then just past half the gap we have this sell side liquidity pool. This suspension block. And then we have this in full gap closure.

And we have new week opening gap down here at 9:07. So that where if we weren't what if it wasn't for the holiday yesterday, uh I would be aiming for new week opening gaps high. But I just want to get a get a pulse on what the market's doing. So far it's hard to argue with that. For the big tool are asking, why would you go in the paper trading after a holiday? Because it can get a little wonky. It can be a slow start to normal trading post holiday volume.

So why throw good money after a gamble? Let it work out the kinks. Let it work out whatever funk or apprehension or excitement or some measure of laziness on the part of investors. Um there may be just a slow start. You know, people coming back in and they tend to not want to move the market too much after a holiday. So, using the the morning session, I'll let them have that, but today I I want them to have my finger on the pulse and see what what we get in terms of market reaction.

Notice how the bodies didn't touch on a closing basis or above or below the midpoint of this suspension block here, son. >> Yes, sir. Yes, sir. >> upper half here. So, it's allowing for the market to want to pull up into this deeper. A close above consequent encroachment of this SIBI means we're likely to probably trade back up into 9:30's opening price again. Which is it's reasonable, it's not completely out of the ordinary for something like that to happen.

Plus, we have last Friday's first presented fair value gap there as well. I like how heavy it just got there when it went into lower half of that semi mouse hole I told you earlier. We don't want to see it trade back above here. And while it's in that lower half we just went right up into this and then look how heavy it got. So I wouldn't be surprised to see it go down in the next couple candles to get down into new week opening gap high for this week.

Any position that would still be open the stop loss could rest right just above that high now. And if you had enough on to warrant doing so below that low here would have been wonderful to take a a partial off. Anytime it creates a new low and you haven't taken a partial yet it's actually a good idea to to pay yourself. This low right here, there's sell side resting below that. We just cleared that. If you didn't take a partial there, that's a good place to take one.

And I call that running down equity where you're you're pursuing new increases in your balance and not demanding that your entire terminus be the only way you you get paid. That's that's that's not terribly important. When you're developing, when you're working out your model. Almost. There it is. There you go. That's it. >> [laughter] >> Don't It's almost like the old man knows what he's doing. I did a little bit of work on Asia last night.

Um Where are we at here? There it is. Um I was looking at this where we had client We We dropped down into new week opening gap for this present week. We traded down into it. Look where the bodies are. So, they weren't interested in exploring any lower. Um this candle actually opens below it, but the next one here opens at it and then rallies higher. And then you can see all the discount sensitivity where it's utilizing that.

And we rallied up and we got into Friday of August 28th. First presented fair value gap. And we retraced back down in. I felt like that we had created enough of a turn here that if you go over here just a little bit to the left more. These highs in here. I elected to use that as a draw. There. You can see the entries here inside of Friday's first presented fair value gap. The stop loss was just underneath this candlestick's low and I'll show you.

Right under here. So, it got real close to it but didn't get there. So, I had a little bit of heat on that. So, the entry was 595.25 and the lowest low it went against me was 75. So, about 10 handles or was it 20 handles on three contracts, which is insignificant. And then it rallied up and it took out those those highs right there. You can right there is where you'll see the little what you want to call it that shows up when you highlight your execution right there.

It went on to go a little bit higher, but I could care less. But it's interesting how they came that down and used that same little smooth area over here. [clears throat] They utilized that right there and then sent it even higher. Then gave up the ghost at uh 12:46 a.m. A really nice sell-off. It would have been fun to be awake during that time. And went right back down to new week opening up again. And then Thursday's first presented a fair value gap.

I mean, look at that. This is brilliant. And now look at where we're going. >> [laughter] >> So we're taking out those lows here and that low right there. It just took it out. So, not bad not bad for a day back from hollow hollow volume on Labor Day. So, I'm going to kill this recording for teaching purposes. I'll throw it up on the uh on YouTube real quick. Let me just make one more annotation. As we were saying here, you know, I don't want to see this portion traded to or even tested.

We only got up into this part here and then from this level 1825 is the price. And I'll drop down to the there. So, you can see what we did was we just simply used the portion of price action that I teach you. It's going to be premium sensitivity. So, we see it trade up in the bodies are staying in the lower half even of this portion. So, all things indicating that this was not likely to go higher. And we went lower.

I said, "You know, I like how that's heavy." And you would see the candlesticks start running lower. And we did in fact did that very thing. So, very, very important um just as a rule of thumb, after the holidays go in light, even if it's paper trading, just to get a feel for price action. Don't be in a rush to get back in there and start you know, trying to capture money. You There's plenty of days in the rest of this week to do that.

But, this is an illustration on how to start back after a holiday. And again, it's not about the money. It's about you getting in sync with the with price action that you're doing and not trying to you know, force a will. Use the information that I teach. We had our premium gap opening. We'll look at our trading hours one more one more time. There's your gap. Here. So, it was this. From here to there. That's your entire gap.

And half gap is right here. And it got there real quick. And then we used the rule that I gave for premium sensitivity. Not seeing the upper half of that sibi traded to or even tested. It didn't happen. And we sold off and went out beyond the bounds of uh what I was looking for just to have something {quote} {unquote} profitable. And then that low was taken out right there. So, it was simply going down to take that. Nicely done.

Any questions on that before I close it? >> No, sir. >> All right.