Hey Trader,
Spreading Love and Support in Our Trading Community
I hope this email finds you well. As we navigate the ups and downs of the trading world, I wanted to share an inspiring verse with you:
"Dear friends, since God so loved us, we also ought to love one another." - 1 John 4:11
In the fast-paced environment of retail trading, it's easy to focus solely on numbers and strategies. Yet, it's equally important to remember the power of community and support.
Just as we receive love and grace, we should extend that same compassion and encouragement to our fellow traders.
By uplifting one another, we can create a positive and thriving community where everyone has the opportunity to succeed.
Keep supporting and encouraging your peers, and together, we will achieve great things!
Be Relentless In Pursuit Of The Will
Which God Has Set Upon Your Heart,
Anthony Speciale
Analyzing Session High On Multiple Timeframes
Welcome! It's Anthony here from Speciale Analysis. I hope you're all having a great day.
Today, I want to delve into the recent crude oil sell-off and share some insights that can help you refine your trading strategy.
Understanding the dynamics at play and how to interpret key market signals is essential for making informed trading decisions.
Market Context: A Closer Look
We recently experienced a sell-off in crude oil, triggered by various factors, including Fed Chair Powell's speech at 9:30 a.m. and the JOLTS job opening report at 10:00 a.m.
During this period, the NASDAQ and S&P 500 exhibited an aggressive upward trend, with the S&P holding liquidity at 5540.
If the S&P can push through this level, it might continue its upward momentum, driven by two-time frame momentum.
Gold also demonstrated notable activity. We identified a low this morning based on high volume, and while it has been somewhat volatile, it has maintained that low.
Now, let’s focus on crude oil. Here, we encountered a high with significant buying volume, which is crucial to understanding the subsequent market movements.
Crude Oil: Analyzing the High
At this high level, we observed a few critical factors.
There was an influx of high buying volume, particularly at the 8:40 a.m. candle, which faced resistance at the 9:00 a.m. open.
The footprint chart revealed that the top two ticks of this candle contained all the buying delta.
Despite this aggressive buying, the market started to pull back, indicating a lack of follow-through.
We identified several key levels that, if broken, would suggest a continued downward trend in crude oil:
84.16
83.95
83.65
Point of Control: 83.45
Session low: 83.35
Macro Support / Ultimate Targert: 82.75
Actual Session Low: $82.72
As the market broke these levels, it continued to push lower, moving into prior day levels. This rolling over from the high point indicated a potential sell-off, which we need to examine closely.
Using a 4-hour chart to view the volume profile for each daily session, we noted the push through key levels.
Observing the short-term charts, particularly the 5-minute and 3-minute charts, provided different perspectives.
The 5-minute chart showed strong buying at the 8:40 a.m. candle, which lacked follow-through. The 9:00 a.m. candle had a significant wick with high buying volume but failed to sustain momentum.
Switching to the 3-minute chart, we saw high selling volume at 8:42 a.m. and again at 9:00 a.m. This discrepancy between the 3-minute and 5-minute charts is crucial for traders to recognize and interpret.
Footprint Chart Insights
The footprint chart at 8:40 a.m. revealed that all the buyers were concentrated at the top, with a delta of about 302.
This strong buying interest was followed by a net delta of 66, indicating waning interest from buyers. The 9:00 a.m. candle, despite a volume of over 4700 contracts and a delta of 122, showed that most of the delta was stuck in the top two ticks. This suggests that the buyers were absorbed, leading to a loss of buying interest and a potential for selling.
Trading Strategy: Taking Action
With these observations, I decided to short the market. The analysis indicated that the buyers were exhausted and sellers were stepping in.
My profit-taking strategy involved marking key levels on the chart and taking profits as the market moved towards these levels. For instance:
84.16
83.95
83.65
83.45 (Point of Control)
83.35 (Session Low)
Once these levels were breached, I anticipated further declines towards 83.00 and potentially 82.75.
Learn and Adapt
In trading, it’s essential to adapt to market conditions and continually refine your strategy. Today's market offered a consolidation phase with minimal follow-through on upward moves, indicating a potential reversal.
Identifying and acting upon these signals can be highly profitable.
For those interested in deeper insights and real-time analysis, I provide daily interpretations and expectations for the NASDAQ, crude oil, S&P 500, and gold futures.
My goal is to share my experience, helping you make informed decisions that align with your trading plan.
If you’re interested in learning more or have questions, feel free to reach out. I offer personalized consultations to ensure we're on the same page before you join.
Stay informed, and stay disciplined!
Thank you for reading, and I look forward to seeing you in our next session.
God bless, and have a wonderful day!
If you have any questions or need further guidance, feel free to reach out. info@specialeanalysis.com May the markets be ever in your favor!
Happy Trading,
Speciale Analysis
About the Author:
Anthony Speciale is a seasoned market analyst with over 13 years of experience trading. Through his platform, Speciale Analysis, he offers in-depth market analysis, interpretation, and expectations designed to help all types of traders, at every skill levels reach their full potential.
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NOTE: Trading involves significant risk, and it's essential to approach it with a well-defined strategy and a disciplined mindset. This blog post is intended for educational purposes and should not be considered financial advice. Always conduct your own research and consult with a professional before making an financial decisions. For further risk related information, please refer to: www.specialeanalysis.com/disclaimer