First, here's the 15 min candle chart that would alert any astute trader where /tf might be entering a heavy supply zone.
Around 10:20 am - /tf was on a roll. But the 15 min. chart above shows potential supply. Given that the daily charts are sloping downward, one should certainly be thinking a pullback is possible. However, in order to safely avoid getting whipped and avoid the psychological pain of waiting forever for a drop, the next step is to look for bearish indicators on the 1-min chart.
And here's what we see:
The first thing I observed was the Puke Candle at 10:20 am. However, I have added a new indicator -- quite simply, called the Dump Candle. Just because price was rejected at the highs, does not mean the market will selloff. At 10:43 a big volume sell candle printed so this suggests there are bigger sellers getting out. But still, no pattern to work with.
At 11:11, another Dump Candle prints. This is FIFTY minutes after one has already determined we are probably topping out... and here we are, still waiting for confirmation. Patience is a virtue.
/tf began climbing up once again but this time, note the lace of volume. At 11:28, it is possible to draw a descending trendline (3-bump pattern) touching 3 points. Here at last, is the ideal short entry -- risking no more than 8 ticks.
Needless to say, this would have worked. /tf went on to drop over 100 ticks from this point... with less than 5 ticks heat. (70 ticks within half an hour from entry.)
In fact, a trader in a chatroom I frequent (stockguy22.com), rode /tf for nearly 130 ticks. Real traders are making these trades. And they're not predicting or thinking. Just executing a plan.
If you are struggling and looking to improve your futures trading, just keep studying and observing and writing. This set up is nothing new to this blog.
I hope you had a good day and didn't get zuckerberged like some probably did. If I can accomplish one thing on this site, it will be to spread the use of the word 'zuckerberg' as a verb. I think we all know what it means.
See you tomorrow. Oh, and if this post helps, all I ask is that you send a link to someone you know. Sharing is caring.