FOLLOWING THE AUCTION – VPOC, MODE, AND THE MEAN

In this series, Following the Auction we’re looking at several terms covered in our Glossary, found through the link on the home page.

This week we’ll look at VPOC, Mode and Mean. These terms are often confusing because of their similarity. The Mean is synonymous to the middle. It is the mid-point and has no relationship to a profile other than the mathematical 50% of whatever range is being considered. Many day-traders are very keen on observing ‘half-back’ for acceptance, rejection to initiate, close or manage positions. VPOC is the Volume Point of Control. It is the price that has traded the most volume for the period or session being analyzed. The Mode is the value that appears most often in a set of data, so in essence the mode and the VPOC are the same. A VPOC can be found in a 5 minute time period, or as shown in this chart, for the year. VPOC is an attractor, a magnet, and the tractor beam for Friday’s late rally. The chart shows the following information.

• The years open, 1815.50, high 2014.50, low 1709.75, 10/24/14 close 1960.50.
• 3 major balance areas,
  • 1^st, Jan 1 through Feb 14, VPOC 1809
  • 2^nd, Feb 14 through May 23, VPOC 1850.25
  • 3^rd, May 27 through October 10, VPOC 1961.25
• Fibonacci retracement from low of year (in green) to high of year and note the 61.8% retracement is 1826.25.
• Fibonacci retracement from high of year to pullback low (in red) and note the 76.4% retracement is 1967.

The yellow circle is the intersection at the current correction low and contains the following data points.

• VPOC, 1809, from the year’s opening balance area.
• The 70% value low, 1822, of the 2^nd balance area, closing open VPOC, 1850.25
• The 61.8% retracement for the low to high of year, 1826.25. Click on chart to enlarge.

Now that we’ve hit the VPOC magnet to the tick, what’s next??? Be sure to tune in early Monday morning for Pat Tabet’s Pre-market update for MOM’s proprietary analysis. You can also read Charles Cochran’s commentary on the es, zb and 6e. Then pre-opening bell, Lewis Borsellino will post a ‘Morning Call’ video with the latest update and his plan for trading the day. Updates are posted on an as-needed basis. LAST WEEK THIS TEAM WAS ON FIRE!!! SIGN UP AND CLEAN UP!!!

 

Following the Auction – Week of October 6th Pre-Market Review

This week in Following the Auction we’ll look back over the week via our Pre-Market Updates and note where the Bull/Bear line was for the day as well as support and resistance and any special notations in the pre-market related to bias.

Coming into each day the registered trader can read Pat Tabet’s Pre-Market update. The bull/bear line is an important tool for planning the trading day. Please note, looking over the past week, selling rallies when price is below the line and buying pullbacks when price is above the line were the highest probability trades on any given day.

 

Monday Pre-Market Bull/Bear 1963

Bias lower

 

 

 

 

 

Tuesday Pre-Market       Bull/Bear 1954.25

Bias lower, possible test of 1931.25

 

 

 

 

Wednesday Pre-Market Bull/Bear 1930.25

Unlikely to fall below 1918 today, 1926 could provide support for a rally. Expecting active buyers around 1919-1918.

 

 

 Thursday Pre-Market    Bull/Bear 1957.50 to 1955.75

Bias, fill in singles from prior day’s short-covering rally.

 

 

 

Friday Pre-Market  Bull/Bear 1924

Bias, DETERMINED TO TEST 1900, BELOW 1900, COULD PUSH TO 1894.25

 

 

 

Remember to prepare each morning starting with the Pre-Market update to mark your charts. Lewis Borsellino will update users at the open and during the day. Have a great week! Trade safe… always use a stop!

 

10/3/14 – MOM ALERT, PRE-MARKET UPDATE, TRADE MANAGEMENT EXAMPLE

MAN OVER MARKET, (MOM) alerts give the registered user access to the team’s proprietary analysis. Beginning with Pat Tabet’s Pre-Market Update delivered before 6am CT for the day session ES. Next about 7:30 am CT comes Charles Cochran with his Pre-Market Commentary with actionable plans for ES, ZN, ZB, CL, GC and 6E. Prior to the open Lewis Borsellino posts a youtube video update with charts. During the day Lewis posts updates on an as-needed basis.

The chart below shows the 3 scenarios posted in the Pre-Market Update for the upcoming ES day session. Please click to enlarge.

As the day unfolded, depending on the time frame one trades, there were multiple opportunities for low risk long entries with very visual profile targets. Our example trades use the 30 minute time-frame.

Below is one example how-to manage a trend-day, using a 2-lot add-on strategy.

• Market opens 1951.75 and 1 ticks the open before dropping to 1 tick above yesterday’s high.
• TRADE, Long 2 at 1947, stop below yesterday’s high of day, 1944.75. Above bull/bear zone, gap bias, possible trend day.
• A double rotation rally rips up to 1957.25, rotates back to 1953.25 then continues up to 1960 leaving a decent high. A rotation down to 1952 showed little interest in selling and key – stays above the open.
• TRADE, Still long 2 from 1947, 1 lot comes off at 1957 ahead of first resistance. The pullback stays above the open, 2 lots are added at 1953, our second resistance, now support.
• Short term balance near the base of the singles from 8/30, resolves with a strong upward rotation to 1963, taking out all the singles mentioned in Lewis’s Pre-Market youtube.
• TRADE, Long 3 contracts at this point, 2 are sold at Pat’s pre-market target at 1962.75.
• Pullback to 1958.25 stays above – short term balance area high and day LVN at 1958… a final rally pushes it up to 1963.75, close 1960.75.
• TRADE, final contract remains, delta goes flat, little opportunity for another push, final contract sold at upper distribution vpoc 1962.

Here’s the math…

1. Long 2 @ 1947, stop 1944.75, risk $225, Sell 1 @ 1957, return $500.
2. Long 2 @ 1953, stop (below pullback) 1951.75, risk $125
3. Sell 2 @ 1962.75, return $1,275.
4. Final contract long remaining from 1953 sold at vpoc going into the close @ 1962, return $450.
5. Total return on this strategy for the day $2,225.

As always, have a great week, trade smarter not more often! And don’t forget… Click on tab above to register for FREE!