Consistency
Setting Charts
Using a uniform set of charts really helps traders approach a consistent trade outcome; in this section we will discuss the chart setups used at the OEC.
There are "analysis charts" and there are "trading charts;" we will begin with setting up the analysis charts using Weekly and Daily time frames.
If your analysis (charting) platform does not let you save a chart setup - maybe look at getting a different charting platform! These are a lot of things to build out onto a chart over and over again - it would be much better to build it once and save it.
For indicators, the colors offered here is what we use at the OEC but if you have your own color scheme then it's best to stick with those. Take your time building these charts and getting familiar with them.
Moving Averages
200MA - PURPLE
50MA - ORANGE
20MA - GREEN
10MA - BLUE
VWAP - WHITE
Weekly Chart
200 EMA
50 EMA
20 EMA
10 EMA
Weekly Chart Levels
Last Weeks Open, Last Weeks High, Last Weeks Low, and Last Weeks Close
Weekly chart gaps (spaces from Friday’s close and Monday’s open)
Daily Chart
200 EMA
50 EMA
20 EMA
10 EMA
YTD Anchored VWAP
Daily Chart Levels
Yesterdays Open, Yesterdays High, Yesterdays Low, and Yesterdays Close
Daily chart gaps (spaces from yesterday’s close and todays open)
Intraday Charts
15-minute chart
50 EMA
20 EMA
Anchored VWAP
5-minute chart
50 EMA
20 EMA
Anchored VWAP
Intraday Charts
3500t chart
50 EMA
20 EMA
Anchored VWAP
1200t Scalper Chart
50 EMA
20 EMA
Anchored VWAP
Intraday Chart Levels
Globex Open, Globex High and Globex Low
Levels
With all these various chart times & pivots there are a LOT of lines on the chart and a lot of levels for a trader to consider. Remember that these are "analysis" levels; places were we anticipate price reacting.
These are not "trading levels" yet. Before we consider one of these levels a tradable opportunity we need to evaluate it.
Has price been there before?
Has it passed through there yet today?
Are there a lot of orders around that level?
Are there indications of liquidity?
That was a lot of work! We now have all these saved charts with different timeframes and lines and levels - what do we do with all of this?
Looking Ahead
The goal is to avoid taking trades based on where price is "now;" we want to consider where it will be and ambush it. To achieve this sort of approach we need to consider key levels as entry points.
Mark the key levels out during the "Top Down" morning review and consider liquidity, range, and contract change events. Utilize "Measured Moves" to identify alternative levels for PT's and reversals.
Throughout the trading day, continue to update the chart with the intraday open, high and low levels. Always keep the daily and weekly moving averages identified on the intraday charts.
Some brokers offer "daily" and "weekly" moving averages for the intraday chart - but if your broker does not offer this then just draw a line where the moving average is located & label that line.
Mark out any gaps that exist (daily and weekly gaps) and identify if there are any other pivots of concern. Some "other" pivots include
VPOC
Floor Pivot (Daily)
Floor Pivot (weekly)
Call / Put Wall
Zero Gamma / Volatility Trigger
"Monday Night's High" - was really "Tuesdays Globex high" ... Price was trapped between one day's high and another day's low. It was going to hit one of the other (it hit both).
What’s the Plan?
Once we have some levels on the chart - consider which levels are going to be useful for a trade today. In the picture above - notice that I do not have every level marked? I didn’t mark all of the intraday high or low levels and I don’t have the weekly levels on there - I only needed Tuesday’s Globex high and Tuesday’s intraday low.
Knowing about all the levels we talked about today is important so we know they exist and we can use them - but we do not need to use them all - all the time. Once you have a plan in place to trade todays price - consider clearing up the chart to eliminate any of the lines or levels that are NOT in play for this plan.
