About: Lance Beggs

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Recent Posts by Lance Beggs

Clues to a Quiet Trading Session

 

Some days the market offers complete rubbish.

Monday was one of those days.

Clues to a quiet trading session 

Clues to a quiet trading session

Clues to a quiet trading session

Clues to a quiet trading session

Clues to a quiet trading session

Clues to a quiet trading session

Clues to a quiet trading session

Clues to a quiet trading session

Clues to a quiet trading session

So far we mentioned the following price action clues which helped form my decision to stand aside and watch and wait for better conditions.

  • Overlapping price bars with little directional conviction
  • Plus narrow range price swings
  • Both combining to form a narrow range channel which just drifts slowly in one direction

 

In addition, a big part of the decision is the following:

  • "Feel" – The price movement itself intra-candle just "feels" slow and sluggish. And while it's present through all price movement, it's particularly felt when sitting in a position and it's just NOT moving the way you like.

 

However, there is another quite important input into my decision, which I haven't mentioned yet. (This was actually the whole point of the article when I conducted my planning… yes, I've digressed again!!!)

It's a factor which gradually became clear between 5 and 30 minutes after the session open.

So let's get to the whole point of my article and check this out.

We'll begin by looking at the DAILY chart.

Clues to a quiet trading session

Of note is the fact that the volume of the day (with hindsight) turned out to be the lowest volume in a LONG TIME (excluding holiday sessions). I don't know how long. I'm not a stats person. If you are, feel free let me know how long!  ๐Ÿ™‚

But it was a long time since we've seen the daily volume so low.

And low volume is often (not always) an indication of a dull, lifeless session. Just the kind of session I prefer to avoid.

Of course, the exchange does not publish the end-of-day volume before the session starts.

But it's not all bad.

Here's a tip I learnt many years ago:

  • The opening 30 minute volume gives a clue as to the kind of day we'll get. A very low opening 30 minute volume suggests low participation and (in the absence of any reason for this to change) a higher likelihood of a lower volume day.

 

In other words, if the 30 minute volume is really low, expect dull, lifeless conditions ahead.

So here's the opening 30 minute volume. Again, very low compared with recent historical averages.

Clues to a quiet trading session

And rather than wait till 30 minutes, we can take a quick peek at 5 and 15 minutes into the session.

Clues to a quiet trading session

Clues to a quiet trading session

There is no need to build and display these chart templates which show only the first 5, 15 and 30 minutes of data. Just glance at the volume after 5, 15 and 30 minutes and you'll get a feel for whether it's low, about average or high.

A low opening five minute volume is a warning sign. Participation is low. Interesting! Take note.

If it continues after 15 minutes, this is a bigger warning sign. Take care in these markets.

And if the volume remains low at the 30 minute mark, when compared with historical averages, expect a potentially dull and lifeless session. At least until something shocks the market out of it's slumber and shifts the sentiment of the market participants.

TRADE WITH CAUTION.

A+ SETUPS ONLY.

Or not at all.

Sometimes it feels good to take hold of your small profits and call it a day. There is a life to be lived out there, away from the charts.

On this particular Monday, the volume was low after 5 minutes. And again at the 15 minute mark. Price action had felt slow and sluggish. In particular when in a trade. Price structure had the appearance of potential grind – one of my least favourite trading environments. And then at the 30 minute mark, volume was clearly the lowest for at least the last few months.

There was no need to trade any further.

Tomorrow will be a whole new day and a chance for much more favourable trading conditions.

Happy trading, 

Lance Beggs

 


 

Sometimes You Get It Wrong Before You Get It Right

 

On Tuesday I shared one of my older facebook posts via social media. Copied here:

Stop expecting perfection. Instead, learn to manage your imperfection. 

Repeating the key points for effect:

  • Learn to survive… and even occasionally profit… in the times when your read of the market is wrong.
  • And that will leave you with confidence to attack the opportunity available at the times when you are in sync with the market.

 

I sought out this old post in response to a similar sequence on Monday.

One in which I was positioned wrong in the market. Not once, but twice.

Before taking a step back from the charts and looking with a wider perspective and switching to the right side.

Here is Monday's opening sequence:

Wrong - Wrong - Right

In email Q&A with a reader (Josh) during the week, he asked me the following question, "Do you feel like you're in sync with the market everyday?"

Great question.

The reality is that no, I'm not in sync with the market every day.

There are many times when I've approached the market in a "less than ideal" mental or physical state and it has clearly influenced my ability to get in sync with price movement.

And even when in an optimal state, there are many price sequences which are not simple to read.

That's the nature of price movement – traps, retests, fakeouts.

The market seems at times to take great delight in deceiving us.

So our job as traders includes the following:

  • Managing those times when we're not in sync with the market to ensure we contain any loss and prevent it getting out of hand. Profiting of course, if possible, but our priority is to limit the downside and stay in the game.
  • And then recognising when we are in sync with the market so that we can squeeze as much profit out of it as possible.

 

Wrong - Wrong - Right

Wrong - Wrong - Right

Here is the link to last week's article if you missed it – http://yourtradingcoach.com/trading-process-and-strategy/trading-an-uncertain-trend/

Wrong - Wrong - Right

Wrong - Wrong - Right

Wrong - Wrong - Right

Wrong - Wrong - Right

Wrong - Wrong - Right

Once more:

  • Learn to survive… and even occasionally profit… in the times when your read of the market is wrong.
  • And that will leave you with confidence to attack the opportunity available at the times when you are in sync with the market.

 

Don't expect to always be in sync with the market.

Sometimes you have to get it wrong a few times, before you can get it right.

Happy trading,

Lance Beggs

 


 

Trading an Uncertain Trend

 

The YTC Price Action Trader provides clear definitions for a trend – uptrend, downtrend and sideways trend.

But despite this, there will be times where price action offers something that is not so easy to read.

One of these times can be immediately following a news release:

 

Trading an Uncertain Trend

Trading an Uncertain Trend

Trading an Uncertain Trend

Trading an Uncertain Trend

It would be great if the market was always smooth and easy to read. But it's not.

And that's fine.

The plan at times like this is simple:

  • WAIT until it is clear.

 

If you wish to make "Uncertain" an additional trend type for your trading, alongside up, down and sideways trends, then by all means do so.

But either way, the plan is to wait until it is clear.

STAND ASIDE completely. At least until price reaches the edges of the structure.

What do I mean by "the edges of the structure"?

It's the place where the market has potential to transition into something that is more readable. Something that does fit more nicely into the definitions of up, down or sideways trend.

Like this:

Trading an Uncertain Trend

Trading an Uncertain Trend

Trading an Uncertain Trend

Trading an Uncertain Trend

Trading an Uncertain Trend

Trading an Uncertain Trend

 

An important news release has the potential to completely shift the sentiment of the market. Sometimes the new trend structure is not completely clear, immediately following the news release.

If the trend is uncertain, WAIT until it is clear.

STAND ASIDE completely.

At least until price reaches the edges of the structure, where the trend will (hopefully) become more readable.

The same applies at any other time, outside of news releases. If the market is choppy and you just don't have a good read, it's fine to declare it uncertain. Zoom out on the chart and identify the edges of the structure. Where are the upper and lower zones which might offer some clarity as to what is happening from then on. And stand aside until price reaches these zones.

It's ok to not know. "Uncertain" can be a valid trend type.

Happy trading,

Lance Beggs

 


 

Learning from the Must-Trade Price Sequences

 

Almost all trading sessions will contain one to two price sequences which are absolutely the best.

These can be the difference between an average session where you just grind out a small positive result and a great session where you hit it out of the ballpark.

The price sequences which make your day.

How you define a "must-trade" price sequence will vary from trader to trader. But for most of us they will be the largest and most directional price swings, with smooth price flow at a nice pace. Everything just right!

There can be value in reviewing these post-session.

  • Which were the Must-Trade Price Sequences?
  • Did I capture them?
  • If so, how well did I perform? How did I recognise the opportunity? How could I have done better?
  • If not, was it reasonable to expect that I should have caught them? Why did I fail to capture them? How could I have done better?

 

Let's look at a couple of examples.

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

 

Another example:

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Learning from the MUST-TRADE price sequences

Consider adding this to your post-session review, if you think it will offer value:

  • Which were the Must-Trade Price Sequences?
  • Did I capture them?
  • If so, how well did I perform? How did I recognise the opportunity? How could I have done better?
  • If not, was it reasonable to expect that I should have caught them? Why did I fail to capture them? How could I have done better?

 

Happy trading,

Lance Beggs

 


 

A Simple Alternative Means of Assessing Short-Term Bias & Market Strength/Weakness – Part 2

 

I've long been a fan of Opening Range (OR) theory and the way that it allows us to quickly and easily identify a "bigger picture" session bias.

So last week we played around with that concept and explored it's application in new areas of the chart.

We took the concept of OR theory and applied it not just to the opening bar of the session, but to multiple bars throughout the session as well.

In my own trading, using the 1-minute Trading Timeframe, I apply this to the opening candle for every 30 minute block of data.

This allows me to not only have the "bigger picture" session-wide bias, but to also get a feel for the bias on a shorter timescale as well.

Think of it as being like multiple-timeframe analysis. The standard OR provides a bigger picture session-wide bias. The 30 minute ORโ€™s provide a picture of the shorter-term bias โ€œinsideโ€ that bigger picture bias.

You can find last week's article here if you missed it – http://yourtradingcoach.com/trading-process-and-strategy/a-simple-alternative-means-of-assessing-short-term-bias/

At the most basic level, analysis of a single 30M OR block can provide us with two primary pieces of information:

  1. A sense for the short-term directional bias. Price movement above the OR is bullish. Price movement below the OR is bearish. And price movement stuck at the OR is neutral.
  2. A feel for the underlying strength or weakness within this directional bias. Fast-flowing price movement with little overlap shows a strong supply/demand imbalance. Whereas overlapping, choppy action suggests a much more balanced market.

 

Let's look at some examples of this information as applied to individual 30M blocks:

Analysis of Individual 30M OR Blocks

Analysis of Individual 30M OR Blocks

Analysis of Individual 30M OR Blocks

Analysis of Individual 30M OR Blocks

The real strength of this method though, is not in analysis of an individual 30M OR block.

Rather it comes through assessing the information from the current OR block within the context of either the overall session bias or the preceding couple of OR blocks.

Resolving Bias Conflict.

Resolving Bias Conflict.

Resolving Bias Conflict.

Resolving Bias Conflict.

Resolving Bias Conflict. 

If you like this, I highly encourage you to play around with the charts and see what other information you can gather, in relating one single OR block to those preceding it.

Again though, to reinforce a point from our prior article…

This is not my primary tool for conducting analysis.

I assess short-term bias through six "rules of thumb" which allow me to project the current trend forward in time, identifying the highest probability path for the next couple of price swings. I share this method in my eBook series (Chapter 3). The same applies for the method I use to assess strength and weakness within the trend. Also Chapter 3.

Short-term OR Theory is something that has crept into my analysis process over time, which acts to nicely complement the existing methods.

Sometimes it acts simply to confirm my other analysis. And other times it provides a slightly different perspective.

Either way, I find it adds value.

If this idea appeals to you, try it alongside your current methods of analysis and see if you find the same benefits.

Happy trading,

Lance Beggs

 


 

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