Big Mike's Trading Blog

Day trading futures, discussing money management and trade management techniques, and more

A quick look at CL 12-range today

Here is my view on the 12-range for CL today.  More can be found on the forum in the price action thread.

Let me say this first. Days like today can really be a major challenge to many traders. I am fearful that on days like today, many people won't update their journal because they went a little "full tilt"and did some major damage to their account.

A day like today may look somewhat simple in a historical perspective, but a lot of traders do very poorly on a day that is either trending or grinding like this one.

The best way to combat this is to adapt during the day. Make sure you have a fresh perspective. If you were trying to find a short all day, you should instead ask yourself "Is there a long opportunity here?" and really look for it. Make sure you aren't biased. Many traders are counter-trend by nature, and after a +150 gap they are just foaming at the mouth to go short.

The channel was very well defined early on, so it was pretty easy to only take longs. The issue was the channel was so tight, that if you tried to be a good trader and follow your rules (my rules) of buying the HH breakout, you were left with only table scraps of maybe 6-8 ticks per breakout.

Around 10am we broke down out of the TL a bit. Traders that shorted immediately got trapped somewhat, it wasn't a good idea to short directly into 85.00 area. CL traders should always pay close attention to the xx.00 and xx.50 marks, a lot of stops are placed at these prices and it sometimes takes time to break them down. It is smarter to enter just the other side of these price points, even if by only 2-3 ticks.

The disciplined traders that didn't just jump on the short and waited for the LH got it for a better entry to the short side.

The short didn't last long, because by noon we had made a HH signalling the likely end of this small bearish trend. Confirmation came at 12:30p with a HL+DB being formed. There wasn't much opportunity to trade this (for me) due to the time of day when it occurred.



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