Tuesday, August 26, 2008

The play of infinite timeframes

So whos buying the 60s and whos selling the 90s. Long term, short term or intermediate term? In my opinion its all of the above and all in between. There are levels though where certain players have more conviction, need for inventory or excess off and thats what causes the temporal balance. This balance migrates almost like a tornado shifting from pressure imbalances. And within these balances the respective players excercise relative control. Almost like taylors market cycles.

The dominant flow today occured @ 6:37 (there was one at 5:08 as well) and it was immediately bought up. That set the mood for IB until 8:40 pst when it sold off.
I generally dont get right on board in the IB, but my affinity to buy this level had grown root.

A dominant flow that gets reversed is significant at a support level and the bias is reversed as well. Especially if it happens during IB. I did not get a chance to enter @ the 6:37 bar as the buys reversed the delta to +ve. I did enter and scratch my trade @70 almost an hour later and seconds later it busted through the 72s. My bullish bias was the buying at support and subsequent orderflow. Very brief trade looking for immediate follow through. The 8:40 bar shifted the bias and it took the next four hours f0r the selling pressure to subside.

The involvement of the mutiple timeframes was evident from premarket tussle, to the IB reversal and as we extended the IB range in both direction. The balance area though drew far less interest and we ended the day in low volume.

Now heres the 2 day profile. It serves as the initial balance of the week. TPO count is 135/85 indicating higher probability for a rotation up. I am still concerned about the slight normal variation fattening the 63 area. Possibly suggesting that selling pressure through this level is mounting and value is shifting lower.

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