Daily DAX The long trade on a bounce from 6320 achieved its target of 6360, with only ten

only ten points of heat. Not bad considering

. the potential for chop today. The range was a half point shy of the aggressive estimate. The 3 day profile suggests
Journal hesitance at higher prices going into the ECB rate announcement today and US employment data on Friday.
04 Aug 2010 Range studies: Aggressive 112.5; conservative 85; H 6445/50 L 6255/60 Calendar: GE factory orders, ECB rate, US init claims

DAX 30min Wednesday, 04 August 2010

Wednesday's volume was back within normal the normal
summer range. The wave pattern has completed here, so there
is a significant chance of a pullback ahead of US employment
data on Friday. The ECB announces policy meeting minutes and
Aggressive range H
the rate decision. The status quo is expected -- and priced in.

High Extreme: 6455 (123 fib extension)

High primary: 6420 (range estimate) Conservative range H
Low primary: 6260 (below 3d POC, above key fib retracement)
Low Extreme: 6220/30 (7d POC, key fib retracement) Yesterday's target achieved.

My confidence in this range projection is not high. Rate

decision days are usually quiet, unless there are surprises. The
expectation is no change to rates or posture. I will need to see
decisive price action after the data releases. Until then, one
trade idea. Otherwise, only scalps. HVN

3POC

Conservative range L

Aggressive range L
7POC

HVN

Trade a bounce above 6220, or 6260

on strong responsive buying. Target
6310, trail thereafter if order flow
agrees. Reassess after GE factory
orders, ECB announcement.

Thursday's theme: The odds favor a narrow range day, but of course anything can happen. Scalp the ranges according to price
action of the market leader after the US open (probably euro, but confirm with ES and ESX). Watch earnings, which could end up
moving the markets quite a bit if they are anything like HSBC and BNP reports were on Monday.

Trade ideas: Buy DAX at support and take profit at value.

Long -- Trade a bounce above 6220, targeting 6310, trail thereafter. If strong responsive buying is seen at 6260, buy and target
6310. Trail stop if order flow agrees.

The Lonely Trader

Disclaimer: All information is provided as market commentary and not as investment or trading advice. The Lonely Trader
expressly disclaims liability, without limitation, for losses or damages resulting from reliance on such information. Past
results are no guarantee of future performance. Please consult a registered financial advisor before risking your capital.
 Range Studies for DAX 0910 Wednesday, August 04, 2010
Previous day range 109.0 Comments:
Previous day pattern WS GMT 0506: I've strayed a bit from the statistical range projections, in favor of what I
Number of occurrences 94 consider high probability price points, using a combination of high volume nodes,
retracements, and established support and resistance at previous swing highs and lows.
(last 200 days)
Although the trend is up, the odds of a correction are good.
Avg range after WS 75.5%
> 82.5 <
Prob of expansion → 17.0% Prob of contraction → 67.0% Probability of duplication → 16.0%
Projected expansion 146.5 Projected contraction 66.0 Projected duplication 109.0
( 134.5% ) ( 60.5% ) ( 100.2% )
Daily range studies Volume studies Time, price and event
3 days 99.8 Value area high 6365.0 Aggressive range est. 112.5
10 days 112.6 Point of control 6335.5 Conservative range est. 85.0
20 days 112.5 Value area low 6297.5 Aggressive range H 6455.0
50 days 125.2 Opening range 9.0 Conservative range H 6427.5
10 day max range 200.0 Initial balance 18.5 Today's H range est. 6420.0
10 day min range 47.5 R2 high vol node 6300.0 0.70 Today's L range est. 6220.0
3/10 0.89 R1 high vol node 6280.0 0.80 Conservative range L 6257.5
10 day true high 6376.5 Pvt high vol node 6220.0 1.00 Aggressive range L 6230.0
5 day true high 6376.5 S1 high vol node 6178.0 1.20 3 day range pivot 6280.0
Yesterday's high 6376.5 S2 high vol node 6140.0 0.85 02 Sep 08 high 6566.0
Yesterday's low 6267.5 3D VAH 6319.0 02 August high 6376.5
5 day true low 6063.0 3D VPOC 6279.5 15 July swing high 6264.5
10 day true low 5954.5 3D VAL 6249.0 20 July swing low 5911.5
Yesterday's settlement 6342.5 3 day vol avg 128.9 GE factory orders M/L
Previous settlement 6304.0 10 day vol avg 130.6 ECB rate and policy High
10 day range position 0.92 20 day vol avg 130.6 US initial claims Med

Calendar GMT Area Event Mkt Risk Exp Prev Remarks

Thursday 0130 AU Monetary policy statement Ccy High Inflationary language
1000 GE Factory orders Jun YoY, MoM Equ M/L 24.8 DAX intraday, likely priced in
1100 UK BoE rate decision statement (TBD) Ccy High 0.50 0.50 GBP pairs, likely priced in
Asset purchase target Ccy High 200B 200B See above
1145 EU ECB monetary policy/rate statement C/E High 1.00 1.00 Likely priced in, but intraday volatility
1230 CA Building permits Jun MoM Ccy Med -10.8 CAD pairs, ES correlated
US Continuing/initial claims Jul 24/31 Equ M/L 455K 457K ES, DAX intraday (cont. 4515K, 4565K)

Comments -- and insults as long as they are clever -- are welcome.

See contact info below.

Interested in contributing to this study? Jay Schneider -- FX and futures, range studies
Want to exchange ideas? Have a suggestion? San Diego Area, USA
Email
Please contact --> Blog

The Lonely Trader

Disclaimer: All information is provided as market commentary and not as investment or trading advice. The Lonely Trader
expressly disclaims liability, without limitation, for losses or damages resulting from reliance on such information. Past
results are no guarantee of future performance. Please consult a registered financial advisor before risking your capital.