Video 48 I, J & K: Trading the End of the day Flashcards
At the end of the day, the market is deciding if the current price is too high, too low or about right.
Is there new information about tomorrow that requires price adjustment before the close?
Al is saying that you cannot enter with limit orders in the final hour of the day because you are going against trend, and may not have enough time for price to go in my direction.
If the market is ________ in the final 30 minutes, it will usually be _____________ until the close, and Limit Order market
Sideways
Sideways
When channel starts with more than 2 hours left, then bull trend, not leg in Trading range. Higher Probability of continuing
When a ___________ in the last hour leads to a channel, greater rick of Trading Range and reversal
Reversal
Buy the Close Bull or Sell the Close bear can start too soon and unlikely to last until the end of day.
Too easy to make mistakes at end of day when tired.
Most should not trade limit orders at end of day.
Al’s general rule, is once the market is Buy the Close, get out 1-tick below any bear bar.
End of day: Risk happens fast!
Bears sell, knowing bulls will not buy again today.
Bets time for Buy the Close trend to start is _________ EST.
3:00-3:25 PM EST
If it starts too late, usually not enough time to make a profit.
Since climactic and unsustainable, if it starts too early, probably will end before close.
If starts too late, probably minor trend reversal and TR
Trading a tight trading range at the end of the day is losing strategy
In final hour, most should only enter with stops or market orders in direction of trend.
The market at the end of the day often tests ___________________.
Support and resistance.
If the market is above the open in the final hour and sells off down to it, bulls buy reversal up for possible close near high of day.
End of Day: daily Support/Resistance are Magnets
Close of every bar is important. it’s a test of support or resistance on every time frame.
Look for trades going into close of any bar.
The close on the daily chart is important. That means the final bars on the 5-min chart effect the appearance of the daily chart.
True on weekly and monthly charts too. For example, on Friday, final 1-3 hours, 5-min chart will often test weekly support and resistance.
End of month will often test last months support or resistance on those higher time frames. if the market is close to those targets you want to trade towards those targets
Weekly Support and Resistance is important on final hour(s) Friday
Monthly Support and Resistance is important on final hour of the month
