Playback With ZT (Brach) ES070104

Educational Discussion

13:34 av: I am still not confident with the wave pattern. I bought the book about Elliott's Wave Theory and am reading little by little trying to grasp as much as I can. It is more the waves and the Fib Ratios that I am interested in

13:35 ZT: Well, the waves are not always clear and u have to distinguish between guidelines for counting waves. Basic guideline is that:

2nd waves retrace 62-79%

4th wave retraces 38%

in ABC, C tends to = A

in 12345, w3 tends to be 1.618*w1

and w5 tends to be = w1

13:38 ZT: That's it

13:37 av: Additionally I am looking at the Stoc, MACD, and Moving Averages etc

13:38 av: Are we able to find this pattern on a daily basis on the ES

13:38 ZT: maybe

13:38 av: Sometimes, I see that you use the Previous days trend to continue to the current day. I still have not mastered that technique

13:39 ZT: Most of the time, the intraday mkt is just marking time by bouncing between nearby BZ

Playback ES070104

13:46 ZT: make it Jan, 10 and also download the previous 6 days

13:46 ZT: ES070110 and previous 6 days -- let me start it and I'll post my PB settings


13:51 ZT: I'm showing about 1414.75 at 6:40 PT on the 5M

13:54 av: Do you show only the day session for the minute charts

13:54 ZT: y


13:55 ZT: possible double bottom here with low from 1/8, see chart

13:56 ZT: mkt tends to fill in gaps so I'm looking for rally from this double bottom up to 1420

13:56 av: k

13:57 ZT: I'll wait for an up bar

13:57 av: why 1420

13:57 ZT: because of the double bottom


13:57 ZT: that's the top of gap range

13:58 ZT: 2 strategies: (1) entry long here and put stop below LOD

13:58 ZT: or (2) enter long at w2

13:59 ZT: (2) requires waiting for w1 and w2 to complete

13:59 ZT: I will enter 1/2 now placing stop loss at 1412

14:02 ZT: reward = 1420-entry price. Risk = entry price -1412

14:02 ZT: entry price = 1414.5

14:03 ZT: so reward/risk = 5.5/2.5

14:04 av: Do u also look at other TF for confirmation of any sort

14:05 ZT: yes look at 1000v

14:05 ZT: moving stop to 1415

14:07 ZT: moving stop to 1416

14:07 ZT: stopped out

14:10 ZT: looking to buy at 62% retrace

14:10 av: 62%, how do you calc this

14:11 av: Fib Ratio between LOD and HOD


14:12 av: it just went through 1418

14:16 ZT: buying here


14:17 ZT: maybe another buy around 1417


14:19 ZT: long 10 at about 1417.38 (avg. price)

14:20 av: what prompted you to buy here?

14:20 ZT: support, buying another 5 at 1416.25


14:22 ZT: selling 5 at 1417.25

14:22 av: where is support?

14:22 ZT: 1415.5 and 1415


14:23 av: you saw resistance at 1417.50 and hence sold 5

14:23 ZT: buy 5 @1417 -- will sell at 1419

14:25 av: 1417 because it broke the resistance


14:26 ZT: I'm flat now

14:27 ZT: if is gets to 1420, start looking for a sell opposite



14:30 ZT: selling 5 1419.25 and stop at 1420.5

14:31 av: was there a confirmation for the decision as to not wait for 1420

14:31 ZT: double top

14:32 ZT: also sell 1418


14:32 av: need to train the eye

14:34 ZT: yes

14:33 ZT: target = 1415

14:34 av: .618 retracement

14:36 ZT: BZ res at 1419.5 to 1421.5


14:40 ZT: selling another 5 on break


14:42 av: where is the sell stop for the extra five that you just sold

14:42 ZT: 1419

14:42 ZT: flat here due to descending wedge (DW), will short again at 1419



14:46 ZT: short again at 1417.38

14:47 av: is there a reason for short at 1417.38?

14:47 ZT: trendline break


14:49 av: do you manage each trade separately or avg the stop limit

14:49 ZT: avg

14:50 av: it's just about to touch .618

14:50 ZT: yes, now flat

14:52 av: any reason for going flat?

14:52 ZT: hit support

14:52 av: do you continue to play this?

14:53 ZT: yes but not looking for long


14:54 av: we wait for A-B and then play the leg at C?

14:54 ZT: yes, this rally began from a double bottom, so the C of ABC may make a double bottom with A

14:56 av: A would be the price at 1415


14:59 ZT: expect B wave to retrace BZ of A wave so will short 1418-19



15:02 ZT: now short at 417.75, stop loss at 1419.5, should return at least 3 pts

15:03 av: always wait for Wave B to retrace below the support line, this was from the last session.



15:06 ZT: that's prop page for AskRatio-BidRatio (10 wma)

15:06 av: do we tighten stops now

15:06 ZT: yes, 1418

15:07 av: what does the Ask-BID ratio tell us

15:07 ZT: selling pressure, in terms of Bid/Ask and volume of trades

15:08 ZT: now we are another BZ minor sup, so this would be a place to take profit

15:09 av: 1416.30


15:09 ZT: but Ask>Bid still so I would not go long

15:12 ZT: shorting again at descending tops line


15:13 av: I don't know how you can so confidently play this, it's just amazing

15:14 ZT: keep focus on bigger picture, C wave down needed

15:15 ZT: We've begun the slow 9AM-11AM PT time so not much chance of rally


15:17 av: do you tighten the stop limit for wave C?

15:18 ZT: yes, I also take some profits since we at minor BZ sup again

15:18 av: It's just about to touch wave A -- 1415 --> so much of support

15:20 ZT: flat


15:20 av: Do you want for another setup or do you take these 2 double bottoms and start all over again

15:22 ZT: long 5 at 1416.5, stop 1414.75

15:23 av: just below the double bottom?

15:25 ZT: just after, and breakout

15:26 av: which breakout are you referring to, WAVE C?

15:26 ZT: 3 up


15:28 av: I see a double top on the 3000 vol... just broke through

15:29 ZT: looks like a breakout from a triangle so tgt is 1425 or 1422



15:32 av: can you show me the properties window for the 100R chart

15:32 ZT: same as 5m


15:37 av: why did you pick wave 3 as the second point for the formation tools and not B? is it because B is a correction?

15:38 ZT: 3 begins at c or e, since this correction was a triangle

15:38 av: do you tighten stops now

15:39 ZT: yes, and/or take some profit

15:40 av: what would be signs of any reversals of trend failures at this stage

15:40 ZT: reaching resistance. Always res at HOD test and sup LOD

15:41 ZT: flat here


15:41 av: if it breaks res, then jump on the train again

15:41 ZT: maybe, I'd rather wait for a pullback to get long

15:43 ZT: support is at yellow line


15:47 ZT: long 1418.88, stop 1417

15:47 av: reason for going long?

15:47 ZT: higher low is just below yellow line

15:47 av: 1417 is the .382

15:48 ZT: flat

15:48 av: which yellow line?

15:49 ZT: the one that is sup


15:49 av: was that a loss or did you close the position

15:49 ZT: no, 3/4 pt profit

15:50 ZT: buy here on rising sup line -- these are scalp trades, just going for 1/2-1 pt


15:52 ZT: stop 1418

15:52 av: I see 3 doji's on the 3000 vol

15:53 ZT: take profit at res



15:54 av: what would be the stop limit on these

15:54 ZT: 1421-22 or mkt

15:54 av: profit means close 50% or all

15:54 ZT: flat, out at 1421.5


15:56 av: are u also looking at other charts right now

15:56 ZT: yes, 5m and 3000v -- sup is now 1420

15:57 av: how did support become 1420

15:57 ZT: want a pullback near 1420 before getting long again

15:59 av: are you flat or long

15:59 ZT: flat

15:59 av: it's just moving along the res on the 3000 vol

16:00 ZT: will short at 1422, tgts: 1421, 1420


16:01 av: is it because of break out

16:01 ZT: rising wedge


16:02 av: can u post the 5 min

16:02 ZT: C=A at 1422.5


16:03 av: I see that, there are Doji's on the 3000 vol

16:04 av: 1421.50, 1 doji

16:06 av: how many contracts do you trade while scalping

16:06 ZT: 5

16:06 av: Does these doij's on the 3000 vol signify anything?

16:07 ZT: I'm only looking at 5m doji

16:07 av: what would be the stop limit for the 1422 short entry?

16:08 ZT: 1/2 pt above high

16:09 ZT: short from 1422

16:09 av: this is sort of difficult for me to grasp -- 4 bars touched 1421.25 on the 5 min, don't you take that as a support


16:11 ZT: maybe I should lol, but I'm seeing this thru

16:11 av: just made a new high at 423.25

16:12 ZT: shorting again at 1422.5 -- tgt: 1421, 1420

16:13 ZT: now short 10 @ 1422.5

16:14 ZT: flat

16:15 ZT: long 1421, stop 1419.5, tgt 1424

16:15 av: why do you go long now? are you confirming with some chart? can you post it? do you take the doji as support?



16:17 av: and 1 LL

16:17 ZT: trend is still up with major sup at 1420

16:17 av: I forgot about the major trend


16:19 av: formed a support @ 14.25 again -- how long does this scalping go on? do you look for another major trend in between?

16:22 ZT: 15m

16:24 av: chart please


16:25 ZT: looking to exit around 1424

16:25 av: don't you use the 200, 50 moving averages

16:25 ZT: no -- flat


16:27 av: how many monitors do you have

16:28 ZT: 3

16:28 av: requires so much of co-ordination to look at multiple TF's and you also trade multiple symbols

16:28 ZT: 1 for order entry. the other 2 for charts

16:31 ZT: will buy at 1421.5 (62% sup and t/l sup)


16:32 ZT: see how I keep playing the long side for all it's worth but only on pullbacks

16:32 ZT: long now at 1421.75, 10 contracts -- tgt: 1424

16:33 av: I am going to put together this chat session and paste the charts in between and then re-try this a couple of time and make myself comfortable with the setup and TF's

16:33 av: test of previous high.... why 1424? is it because of the top of resistance on the 3000 vol?

6:35 ZT: yes

16:35 ZT: Yesterday HOD = 1423.75

16:41 av: are u looking at other charts right now

16:41 ZT: just 3000v

16:41 av: do you take any profits now @1423.75

16:42 ZT: still long 10 @ 1421.75

16:42 av: stop limit -- it's teaching me lots of patience

16:44 av: sometimes you post the 9000v charts. is there any reason for picking the 3000 today.

16:44 ZT: y

16:44 ZT: flat, out at 1423.75

16:45 av: 2 points -- that's a beautiful score

16:45 ZT: I'm up $8813

16:45 av: I felt this was just too tight for me before this PB. we don't short here

16:46 ZT: might be a short here -- would like to see 1424 first


16:46 av: the range is slowly narrowing down

16:47 ZT: yes

16:47 av: since the market has moved sideways with a narrowing rage, do you still think it will hit 1424

16:48 ZT: yes. IB requires full margin after 12:45

16:48 ZT: I will short there,

16:49 ZT: short 5 @1424

16:49 av: stop limit


16:50 ZT: tgt= 1422 (w4)


16:51 av: are we in wave A

16:52 ZT: yes

16:54 ZT: tgt revised: 1422.5


16:58 av: do you tighten the stop here

16:58 ZT: yes

16:58 av: what would be the expected stop limit?

16:59 ZT: 1422.25 -- 1422.75

17:00 av: that brings us to 12:50pm

17:00 ZT: 12:54 and flat

17:00 av: how much do you pay for commission per contract?

17:01 ZT: $5 per round turn but for playback, I set it to $10

17:01 ZT: long at 1423

17:02 ZT: long 5 @ 1423, stop 1422, tgt 1424


17:06 ZT: flat: 1423.75

17:07 av: do u still continue with wave C

17:07 ZT: yes

17:07 ZT: C up, but that would be next day

17:08 av: why do you say C up

17:08 ZT: 27 trades

17:08 av: can u give me a projected chart for C up? 27 trades - does this equal to 27 contacts or 27 buy + sells

17:10 ZT: 27 round turns -- 5 contracts per turn


17:10 ZT: 1431 would be next tgt

17:12 ZT: ES is a tough mkt

17:12 av: but better than the ER2

17:12 ZT: u have to stay focused on bigger picture -- small corrections indicated trend in progress

17:13 av: does the fib retracement work for all the wave's and its correction to a certain degree at least? today's PB was like an example out of the book

17:14 ZT: it can, but best for w2 and wB

17:10 av: thanks for your time ZT