{"id":64724,"date":"2017-03-26T03:20:28","date_gmt":"2017-03-26T10:20:28","guid":{"rendered":"https:\/\/brookstradingcourse.com\/?p=64724"},"modified":"2021-09-22T00:57:55","modified_gmt":"2021-09-22T07:57:55","slug":"trading-room-extended-discussion","status":"publish","type":"post","link":"https:\/\/www.brookstradingcourse.com\/es\/ask-al\/trading-room-extended-discussion\/","title":{"rendered":"Ask Al: Extended trading room discussion"},"content":{"rendered":"\n<h2 class=\"wp-block-heading\">Al Brooks&#8217; trading room sample<br>BPA trading room: September 6, 2016<\/h2>\n\n\n\n<p class=\"content-box-green\">A follow up, long extract from Al\u2019s trading room. This is in response to requests for more such content from Al&#8217;s trading room.<br><em>Video duration: 21min<\/em><\/p>\n\n\n\n<div style=\"position: relative; height: 0; padding-bottom: 56.25%;\"><iframe class=\"sproutvideo-player\" style=\"position: absolute; width: 100%; height: 100%; left: 0; top: 0;\" src=\"\/\/videos.sproutvideo.com\/embed\/a09adfbb1318e4c528\/8c132ee8b11d82b7?playerTheme=dark&amp;playerColor=\" frameborder=\"0\" allowfullscreen=\"allowfullscreen\"><\/iframe><\/div>\n\n\n\n&nbsp;\n\n\n\n<p class=\"caption\">You can also view this video on <a href=\"https:\/\/youtu.be\/uTUYz5YgiK4\" target=\"_blank\" rel=\"noopener\">Al&#8217;s YouTube Channel<\/a> if needed.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Weak openings<\/h3>\n\n\n\n<div class=\"wp-block-image\"><figure class=\"alignleft\"><a href=\"https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2017\/02\/Ask-Al-Brooks-Trading-Room-Extended-Sample.jpg\" target=\"_blank\" rel=\"noopener\"><img loading=\"lazy\" decoding=\"async\" width=\"300\" height=\"219\" src=\"https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2017\/02\/Ask-Al-Brooks-Trading-Room-Extended-Sample-300x219.jpg\" alt=\"Ask Al Brooks Trading Room Extended Sample\" class=\"wp-image-65621\" title=\"\" srcset=\"https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2017\/02\/Ask-Al-Brooks-Trading-Room-Extended-Sample-300x219.jpg 300w, https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2017\/02\/Ask-Al-Brooks-Trading-Room-Extended-Sample-768x561.jpg 768w, https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2017\/02\/Ask-Al-Brooks-Trading-Room-Extended-Sample-600x438.jpg 600w, https:\/\/www.brookstradingcourse.com\/wp-content\/uploads\/2017\/02\/Ask-Al-Brooks-Trading-Room-Extended-Sample.jpg 800w\" sizes=\"auto, (max-width: 300px) 100vw, 300px\" \/><\/a><\/figure><\/div>\n\n\n\n<p>Most days over the past month have had weak openings. The market just kind of goes sideways for a little while. Right here we have a sell signal for a test of yesterday\u2019s high, so it is an okay short below 1. What about buying above 1? It\u2019s a bear bar, and usually that\u2019s not a great buy signal bar, especially at the high. So best choice right here is flat. Buyers or sellers above 1? Better than 50-50 chance sellers above, but still possible low of the day. Buyers or sellers below 1? I think it\u2019s a swing sell.<\/p>\n\n\n\n<p>But with so many days over the past month going sideways on the open, taking an hour or more to decide on direction, today\u2019s probably going to be like every other day, taking an hour or so to decide on its direction. Even here you\u2019ve got a bear trend, but they\u2019re going sideways for a lot of bars. We do not have a big breakout on the open.<\/p>\n\n\n\n<p>So this is a swing short, and it\u2019s an okay swing short, but not a high probability swing short. You can argue test of yesterday\u2019s high. Wedge 1, 2, 3. Micro double top. You saw at 3, again failing to be another big bear bar. More bears gave up and they just started to buy back here, and that made 4 close on its high.<\/p>\n\n\n\n<p>I am still neutral. I think still Always In Short, but not strongly bearish. Bulls hoping the sell-off is weak enough, so that traders will see it as a bull flag. The bears are hoping that we just work lower and have a swing down. I am slightly more bearish than bullish because we\u2019re at resistance, yesterday\u2019s high.<\/p>\n\n\n\n<p>But this is not looking like a bear swing, this looks like a trading range open, and the market is deciding if the initial move will be up or down. For the bears are hoping for an opening reversal, a rally to resistance, yesterday\u2019s high, Friday\u2019s high, and then a reversal down. The bulls are hoping for an opening reversal, a pullback to support, moving average, and then a trend up.<\/p>\n\n\n\n<p>But right now the market is, I think, neutral. It\u2019s Always In Short below 1, but I think it\u2019s really neutral. Traders need a breakout one way or the other. This early two-sided training, a lot of little reversals at the top of our weak rally with a lot of small bars, prominent tails, reduces the chances that today will be a big trend day up or down.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Daily chart analysis \u2013 Trading range day<\/h3>\n\n\n\n<p>Also, look at the daily chart: the past four days were all dojis. That means the market traded one way and then the other way. Right now the odds are today will be mostly a trading range day, which means it\u2019ll probably have a 2- to 4-hour swing in one direction, and then a swing in the opposite direction. We\u2019re only 10 points away from the all-time high, so we could easily get there today. However, this open so far I think increases the chances that the day is going to be mostly a trading range day.<\/p>\n\n\n\n<p>I think it\u2019s interesting that the bulls made money buying below one, and the bears have not made money, unless they sold the 1 close. You can see it fell 5 ticks, so the traders who sold the 1 or 2 close made 1 point. Makes you question just how bearish this is; 5 bars into the day, the bears had one reasonable scalp. Some traders may have sold a tick below the 4 high, betting against a successful bull breakout.<\/p>\n\n\n\n<p>But even though we have a bear reversal at resistance, yesterday\u2019s high just below the all-time high \u2013 it has not been easy for the bears to make money. That reduces the chances \u2013 makes it pretty much equal, 50-50, that we\u2019ll go up or down.<\/p>\n\n\n\n<p>They can be short still, stop above 1, maybe a stop above 4, I don\u2019t know. The bulls do not have a stop entry buy yet, but if the market gets above 4, that would be a buy \u2013 but not a very good one. I think most traders should either be flat or short.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Surprise moves<\/h3>\n\n\n\n<p>A lot of times the market does something like that. If you\u2019re quick, you sell this reversal down. The market very often goes the wrong way to trap traders, and you\u2019ve got to be ready for it. I sold after the market went below 7, so I got filled down here. But you\u2019ve just got to be really quick. Very often the market does something like this, traps traders into doing the wrong thing. You can see we went above 7; we also went above 5, a big bear bar, and above 4. Instead of buyers, institutions came in and sold.<\/p>\n\n\n\n<p>Until it becomes clearly a trend, I usually scalp out for a couple of points, and I just get out and back to flat. But this is a \u201cgive up\u201d bar. The market right now is deciding whether this is the start of a bear swing that could last 2 or 3 hours, or is it going to fail and instead lead to a trading range. I think it\u2019s a pretty impressive bar, so I think the odds are, right now, 50% we\u2019ve seen the high of the day.<\/p>\n\n\n\n<p>You look at it and see 7 \u2013 there\u2019s a bull bar closing in on its high, and trying for the moving average. How can it do this? It\u2019s a 7-bar bear micro channel, so I certainly don\u2019t want to buy above any bull bar, even a good-looking bull bar. It\u2019s a tall bar, so the risk is relatively big. It\u2019s in both a bear channel and a tight trading range, so I don\u2019t want to be buying with a stop above.<\/p>\n\n\n\n<p>What I do is I wait to see if it starts to do that. I was slow making up my mind; I could\u2019ve sold sooner. But I still was able to get at least a short in there.<\/p>\n\n\n\n<p>We\u2019re back in this tight trading range, so we\u2019re going to go sideways here. Bears want to keep the gap open, 7 low, and the bulls obviously want to close the gap and they\u2019re hoping that this bear breakout fails. There\u2019s the measured move, takes us to the bottom, spike channel. Very often the market comes back down to the bottom of the channel, the first pullback after the breakout.<\/p>\n\n\n\n<p>The market\u2019s deciding how bearish this will be. We already see the big tail on the bottom of 8. That\u2019s a problem for the bears. We had a day like that last week. Will we do this? Probably not. When you get these big bear breakouts and you get a tail, or bad follow-through on the next bar, it increases the chances you do this or even get a couple legs up to there.<\/p>\n\n\n\n<p>Here\u2019s an example. Big bear breakout, close below the low of the last 10 bars or so, and then big tail, bull bar. We\u2019ve got to bounce. We stayed below the top of the bear breakout, but a lot of weak bears got out. So we might be doing the same thing here. Will the bears get good follow-through selling on bar 9?<\/p>\n\n\n\n<p>I shorted again here. This time I got out with 1 point. I\u2019m back to flat. I think the odds are 9 is going to disappoint the bears, so I think it\u2019ll be a small bar, or an inside bar, or a bull bar. There\u2019s something wrong with it. But if it closes on its low, we might end up with a bear trend day. We still have room to a measured move and we have this, so we should get to these two prices. We reversed down, we tried to get above Friday\u2019s high \u2013 which is the high of last week.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Weekly chart analysis \u2013 Buy signal bar<\/h3>\n\n\n\n<p>Do you remember what I said on Friday about the weekly chart? I said last week was a buy signal bar. We tried to trigger the buy on the open by going above last week\u2019s high, and we could not get there. We still have 4 days left including today, so we still might trigger the buy on the weekly chart, which might get us up to the all-time high.<\/p>\n\n\n\n<p>Sometimes I can talk about this. You see a buy signal bar here, buy signal bar there, a high 2, two legs down, one pullback, two \u2013 and you say \u201cHow can 7 form if 8 is so bearish?\u201d I think that some very bearish firms buy during 7 to trigger the buy above 7. They buy through here with the intention of triggering the buy, running the stops. You buy anywhere on 7 to get it to go up, up, up, you buy above 7, and then you immediately sell a huge amount, either at the 7 high or the 4 high. So I think a bull bar like that in this context, in part is created by bearish firms trying to trigger the buy, knowing that they have enough dollars to short that they\u2019ll be able to reverse the market down.<\/p>\n\n\n\n<p>You may say, \u201cWell that\u2019s not fair. That\u2019s cheating. Would anybody cheat?\u201d Well, it\u2019s not cheating. It\u2019s smart. If you\u2019re able to do it, you do it. And it\u2019s not like five firms get together and say \u201cHey, let\u2019s buy this, trap out the weak bears and trap in the weak bulls, and then as soon as it triggers the buy, let\u2019s just dump thousands and thousands of Emini contracts short and reverse it down.\u201d They don\u2019t get together and say that, but enough of them understand what\u2019s going on here so that if a lot of them do it, they don\u2019t have to talk to one another. If a lot of them do it, this is what you get.<\/p>\n\n\n\n<p>But the bottom line is, sometimes a good-looking bull bar and a good-looking buy setup is created by bears, who are trying to trick traders into buying high, either buy back shorts or buy into longs.<\/p>\n\n\n\n<p>Is 10 enough of a disappointment bar to make the bears buy back their shorts? Not really, but in general, if we\u2019re at a major support area like the 60-minute moving average and there\u2019s any hesitation, like bar 11, I do not take the short. If anything I would be buying the 11 low \u2013 which I did not, but that\u2019s the only trade I would take here.<\/p>\n\n\n\n<p>Sell the close, but tail \u2013 inside bar, doji bar. This is not looking all that bearish. I would not sell here. I would still sell the close but we\u2019re right at the 60-minute moving average and yesterday\u2019s low. I think it\u2019s more likely that we\u2019re going to start to go sideways to up a little bit. The bars are not all that big, so not all that bearish, and hesitation bar here, tail here, at support here, at support yesterday\u2019s low \u2013 if anything, the only thing I would do at the 11 low is buy. But I did not do that. I would not sell down here.<\/p>\n\n\n\n<p>We\u2019re hesitating at support instead of collapsing through support, so increases the chances we\u2019re going to bounce.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Limit order trading<\/h3>\n\n\n\n<p>Okay, we just learned something right there. Limit order bulls. Bulls who did buy the 11 low, made money. You look at that and say \u201cWait a minute, it\u2019s a bear trend. It\u2019s a Sell the Close bear trend, but the bulls made money\u201d \u2013 that\u2019s right. Something\u2019s wrong with the bear trend.<\/p>\n\n\n\n<p>Parabolic wedge, 6, 8. Decent buy signal bar. Opening reversal, 60 minute moving average support, low of yesterday\u2019s support. Okay swing buy, taking a chance it\u2019s the low of the day, but not yet high probability. The math is okay to take that buy, but more likely minor reversal, which means you\u2019ll go up 5 bars, maybe 10 bars, and then test back down to the low close, the 10 close, the 11 close. I would not sell the 12 high even though we\u2019re still Always In Short, but I think a lot of the Always-In bears get out above 12 because this is a reasonable candidate for the low of the day.<\/p>\n\n\n\n<p>The bears, they\u2019re hoping that we get a failed breakout above the top of the triangle and then a reversal down. This is really not a very high probability buy, but I think it makes sense. Already 6 ticks, so a lot of traders scalped out, for 1 point. Bulls want to close above 20, hoping for a gap and a measured move up. Like I said, I\u2019ve been saying, I think we would close the gap below the 7 low and get back up into the upper range.<\/p>\n\n\n\n<p>For the bears. Tail, break out above the triangle, a wedge, three pushes up, 1, 2, 3. Any time you have a double top, you have two pushes up. If you break above the double top and the breakout fails, you have three pushes up \u2013 1, 2, and then 3. So for the bears, this is a wedge short. Bulls want the gap and then the measured move up.<\/p>\n\n\n\n<p>This is the neckline of the double top, so the measured move would be from the double top neckline up here. The fight here is the close. Will it close above the double top, will it close above the moving average, will it close on its high? Or will it close on its low, close below the moving average, have a bear body closing on its low, in which case it would be a reasonable short. We\u2019re in a trading range, chances are it\u2019s going to be confusing and it\u2019s going to disappoint the bulls and the bears.<\/p>\n\n\n\n<p>So maybe close at the 20 high, making traders wonder, is this breakout going to lead to a measured move or not? Is this breakout going to reverse? Is it going to be like 7-8? To sell it, I would like to see at least a 2 tick bear body closing on its low for a wedge bear flag. To buy it, I think the buys already over \u2013 you could buy at the market because we\u2019re back at the 21 high. But it looks to me like most bulls scalped when we rallied 6 ticks, which is exactly what it had to do for the bulls to make 1 point.<\/p>\n\n\n\n<p>Bull body, good for the bulls. Close below the double top high, good for the bears. Probably Always In Long at this point. We\u2019ve got a bull close and a reasonable buy setup. But I do not think this is going to result in a big bull trend. I think it\u2019s a bull leg in a trading range. The market\u2019s looking for the top of the range.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Questions<\/h3>\n\n\n\n<p>Trades, would you talk about your trades today. I honestly don\u2019t remember most of what I did. I took one or two scalps in here. I forgot what I did. I sold that, I got out breakeven there, I think, and I think I sold somewhere up there for a scalp. I sold I think twice on the way down with a limit order, and I think I sold again down here, I bought for a scalp. I remember buying again somewhere in here. I sold here. I bought a couple times on the way up here.<\/p>\n\n\n\n<p>And then through here, usually I would sell here, but there\u2019s so little room to the target, the 34 low, I only took buys in here, and I only took one or two in here. And then I was out trading the euro versus the dollar and gold today. I often trade bonds, but I did not do that today. And today I did not do any swing trades in the Emini.<\/p>\n\n\n\n<p>Question: \u201cIn general, is buying or selling the close of large 5-minute reversal spikes occurring near the beginning of the trading day the right thing to do? Example: is shorting the bar 8 close today, using a wide stop the right thing to do?\u201d<\/p>\n\n\n\n<p>In general everyone is looking to do that. If you look at volume here, you would be shorting with 80,000 of your closest friends. So 80,000 contracts traded on bar 8. I never look at volume. You just know the bar is big and the context is good, so you know the volume is big. Just looking at the bar, if you asked me, \u201cAl, how big is the volume on bar 8?\u201d, I\u2019d say \u201cI don\u2019t know, probably at least 20,000 contracts.\u201d I would not have guessed 80,000, but it was 80,000.<\/p>\n\n\n\n<p>So in general, I\u2019m looking for setups and I\u2019m looking for trapped traders. I was afraid that 7 was a trap, the 7 bar bull micro channel in a tight trading range, and it looked like a sucker buy for me. It looks like a buy setup for weak longs. I\u2019m willing to buy, but not there. If it goes higher, then I\u2019ll buy. I\u2019ll buy after I see this.<\/p>\n\n\n\n<p>You say, \u201cAl, there\u2019s not much left to the trade if you wait until there.\u201d I say that\u2019s true, but the probability of making money is 60% or 70%. So not buying here, and then I see this and say \u201cOh, those bulls are in trouble, and we\u2019ll probably get a measured move down.\u201d So I\u2019m looking to sell. It\u2019s a high probability trade. At least 60%, maybe 70%.<\/p>\n\n\n\n<p>You can make money selling on the close of 8, the close of 9, and the next target down is far enough away for at least a scalp. Those strong breakouts, 28, probably buying the close \u2013 at a minimum you\u2019re going to make a scalp. It turns out if you bought it and held, you would\u2019ve made a swing profit on the way up.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">End of day review<\/h3>\n\n\n\n<p>Do we go higher from here? I still think the odds are we\u2019re going to a new ultimate high. I also think that September will close below its open. I think then that we\u2019re going up near-term, but by the end of the month I think we\u2019ll trade down. Okay, hope everybody has a good night.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Ask Al trading room extracts<\/h3>\n\n\n\n<p>This extract will be the last of the weekly <em>Ask Al<\/em> posts for the time being. Priority is on production of trading course videos. The current 99 <em>Ask Al<\/em> articles contain a wide range of price action and general trading topics, and future <em>Ask Al<\/em> posts will look to develop even more variety. One example is putting up of live trade videos after Al has established same in the trading room in the near future. Another could be member webinar replays.<\/p>\n\n\n\n<p>Please add any comments below on what you would especially like to see delivered through the <em>Ask Al<\/em> posts.<\/p>\n\n\n\n<p><a title=\"Al Brooks&#039; trading room\" href=\"https:\/\/www.brookstradingcourse.com\/online-day-trading-room\/\">Information on Al&#8217;s Online day trading room<\/a><\/p>\n\n\n\n<hr class=\"wp-block-separator\"\/>\n","protected":false},"excerpt":{"rendered":"<p>Al Brooks&#8217; trading room sampleBPA trading room: September 6, 2016 A follow up, long extract from Al\u2019s trading room. This is in response to requests for more such content from Al&#8217;s trading room.Video duration: 21min &nbsp; You can also view this video on Al&#8217;s YouTube Channel if needed. Weak openings Most days over the past [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"shadow","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[159],"tags":[],"class_list":{"0":"post-64724","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-ask-al","7":"entry","8":"has-post-thumbnail","9":"override"},"featured_image_src":null,"author_info":{"display_name":"BTC Admin","author_link":"https:\/\/www.brookstradingcourse.com\/es\/author\/richardhk\/"},"_links":{"self":[{"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/posts\/64724","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/comments?post=64724"}],"version-history":[{"count":0,"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/posts\/64724\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/media?parent=64724"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/categories?post=64724"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.brookstradingcourse.com\/es\/wp-json\/wp\/v2\/tags?post=64724"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}