Thursday, 24 May 2012

Finding Entry Points

Where do you enter and why? Trading is not an impulse business. It requires quite a lot of thinking.

Before the DAX opened today, I looked at the overnight ES and then decided that I wanted to buy the DAX. I then had to find an area where I wanted to do business. When the market got there, my job would be to see whether orderflow supported the entry or not.

I split the MarketProfile, as you can see in the pic. I found the VAH of the distribution as a potential entry point. The 99EMA was support. When the price got there I decided that the trade was right to BUY. I managed the trade and exited at the 33EMA which has become resistance. Result: 16 DAX points per contract (400 Euros per contract). One contract, one chart. Maybe just one trade for the day?


  1. Tom,
    How do you synchronize your bar interval to the market profile? I used a 1.25 range chart on the ES today and the 33 and 99 had crossed up, the CCI was up but the MP was telling me a very different story. Had I changed the interval to a longer bar length then I would have the 33 and 99 and CCI all telling me what eventually took place.

  2. TylerPM, I don't have "synch" issues. If you have a different periodicity that fits you better then you should use that. There is no magic in my particular chart periodicity. It all works.

  3. "I decided the trade was right to buy."

    How? What told you this? Just saying order flow is far too abstract.

  4. Anon 21:09, All the criteria are repeated here in the blog, over and over. You may want to use some or all of them in decision making. Context.