Let's start with a daily chart to get some "bigger picture" context…

<image: Step back and Reassess>

<image: Step back and Reassess>

And now down to the trading timeframe…

<image: Step back and Reassess>

A little side note regarding the entry: While it may not be immediately obvious, this trade is a variation on the YTC Price Action Trader PB Setup. The pullback is all occurring within the one single TTF candle (in this case the green one prior to entry). While that is not ideal and we would prefer to see an actual pullback of at least 2 or 3 candles on the TTF, the fact remains that in an opening momentum drive this is often all you will get. So we either miss out entirely, or adapt. In an opening drive, I'll be looking to the LTF data for the first pullback. Everything else (eg. LWP entry timing) is as per normal.

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

<image: Step back and Reassess>

If you've lost all feel for what is happening in the chart…

(1) Step back.

(2) Define the edges of the structure.

(3) And wait.

Whatever happens within that no-trade zone, is none of your concern.

Let it break and then reassess.

Only then, if the market structure and price movement makes sense, is it game on.

Assess the trend structure. Project it forward. Identify your opportunity. And strike!

Happy trading,

Lance Beggs

 


 

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5 Comments

  1. Hi Lance. Such a good advice.

    Just a question: after stepping back and defining the edge of the structure you struggled with, were you considering also the option of a CPB short if price were broken the previous swing high level and quickly reverse (i.e. a trap for those longs expecting a trend reversal)? I think it would be a very good short opportunity should it provided appropriate R:R and entry trigger.

    Cheers!

    1. Hi Sergio,

      I’m very wary of structure like this where the opening drive forms a single very-long price swing. And then subsequent swings get stuck within that very wide swing. The question in my mind is – “if the premise was correct, for a quick downtrend through to gap closure, then price shouldn’t be getting stuck like this. So am I wrong?”

      A break above the prior swing high is potential CPB short. And my well have moved through to the target. But it would mean that the “way price is moving to the target” is not anything like the way I expected it to move. I was playing for a quick move with minimal depth to the pullbacks. A break above the swing high here does not fit that premise and would instead mean a much slower, wide swinging and choppier trend.

      So yes, it was certainly in my mind as a possibility, but it wasn’t something that I would have jumped into. More a case of “Ok, I’ve misread what is happening, I really need to reconsider the structure and project forward with a new plan.”

      Whereas a break below the level was something I wanted to trade, indicating the original plan was potentially back on.

      I’m not sure I’ve explained that well. Let me know if it’s confusing and I’ll attempt again. But essentially, while the CPB would be valid, it just didn’t “fit” how I was reading the structure. I may (or may not) have taken it. But I’d have to see how price behaved on the break. And it would require dropping my expectations for quick movement to the gap closure target and instead analysing again from first principles.

      Cheers,
      Lance.

  2. Hi Lance,

    Long time reader, first comment. I hope you are keeping well in these crazy times!

    Now for my question. Would you not have expected the first TTF PB to be a complex correction because of the large/over extended bearish move down right after market open?

    1. Hi Agha, I have absolutely no problem with anyone holding out for a complex correction here. I have guidelines which tell me when to pass on a PB and hold out for a complex correction. They weren’t applying here. Although there is clearly potential, as you have seen. With such smooth price flow though, and good daily range, I am happy to take the PB opportunity here. But as always, if there is limited follow through I’ll be ready to scratch the trade and wait for the next complex correction entry.

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