 Good morning bookmap community. Welcome one. Welcome all good to see you. It is Monday September 25th. My name is Charles This is the bookmap channel and I'm here to talk about the ES the NQ and the two-way auction process How we read it and how we use it to predict what could come next in the market A little disclosure right out the gate the opinions shared today are my own and not the opinions of bookmap If you take any trades based on anything I say you're taking that trade at your own risk Let's have some fun. All right, so We've had some momentum to the downside For the second half of last week that momentum continues this morning. So basically we were kind of just You know bouncing around inside a range kind of grinding up and down trying to figure out what comes next We had the FOMC meeting on Wednesday The reaction to that meeting was bearish which caused the market to push lower and Close at the lower end of the day. So that was the beginning of the momentum to the downside How did we see that visually in the chart to recognize that there was momentum? Well, first and foremost we left behind a set of single prints if you look here in the L period There's a set of letters right there in the middle of the day that are all by themselves That set of single prints Increased the odds that the market was going to continue lower because it created what was called a double distribution In the profile so that was bearish to see we also had that same level was the base of a spike down So that told us that spike rules were in play the next day Spike rules told us that when we opened with a gap down That we still had momentum when you have a spike down and you open below that spike That is the most bearish signal you could get and it led to further downside Continuation okay, well, why do I mention that because that's what we've got this morning as well So at the very end of the day on Friday the market made a spike down and it closed inside that spike and This morning we are opening with a gap down Which means we are opening below the spike down, which is bearish to see so with this gap down this morning Of course, we still got 30 minutes till the market opens it could retrace back up into the range But if we open with this gap down That will increase the odds that the momentum down is still going on the daily that the market hasn't had a big enough pullback If that is the case we have just re-entered Or anyway, when we open we will have re-entered a previous gap Okay, that we left behind on six nine Re-entering that gap Okay, with the bearish momentum on the daily Increases the odds that the market will try to fill the gap So if we open with the gap down, I will be bearish as long as we remain below yesterday's low As long as we are below 4357 I will be bearish and it is because of those two things First thing we have momentum on the daily Second thing we have weakness that needs to be repaired in the form of a gap that needs to be filled below Those two things are enough to get us there today Okay, so the only question I have to ask myself is once the market opens What happens next do we get a gap and go do they grind around for a while and then start to head lower or Do they pull back up into yesterday's range now if they pull back up into yesterday's range That tells me we're not doing the gap fill not right now not at that moment We need to spend more time going sideways inside yesterday's range. Maybe we come back for the gap later Maybe we don't maybe we turn around and head higher. Okay, but as long as we are below Friday's low The higher probability is that we are heading down to fill that gap because of the momentum on the daily Okay So the first order of business when the market opens this morning Will be to try to fill the gap to try to get its way back up to Friday's low 4357 and look for resistance there if it cannot it's heading down to fill the gap to 4325 Okay It really is that simple Can they fill the gap? If not, it's can they fill the gap above? If not, they'll fill the gap below Can't fill the the gap from today fill the gap from a month ago or from four months ago any questions from the chat Good morning ebb and flow Andrew G Tom G Ru Jay Thank God it's Monday casinos are back open. Yeah, baby Spike down gap down new culture in the house. Sebastian is here Andrew D Andrew G He says is Charles as a mic cutting out randomly. Are you guys noticing that is my mic cutting out randomly? Please tell me if it is Also, tell me why you haven't pushed that thumbs up button. We got 50 people hanging out But only 12 likes What's the guy got to do to get a thumbs up around here? Morning Sean. Welcome. Awesome. All right. Well, we've got some time 20 minutes So let's first we'll zoom out and we'll do the top down on the ES and then we'll talk about the NQ a little bit. So One great thing that I like to do which I learned from Jim Dalton on a Monday morning is what's called the top down Approach and the top down approach is it is basically just forcing yourself to zoom out and Look at the market on other time frames to try to give you an indication of what could be happening on the daytime frame So we'll start with the monthly What jumps out at us about the monthly? Is there any information here that might be helpful? Well for one thing I'm seeing that we have a bit of a channel in the monthly and that we are working our way Down towards the lower end of that channel. So that's not anything that's actionable for me today But it is important to keep in mind that if this market You know, so say it sells off a little bit more and it turns around and it starts heading back up I don't want to fight the momentum on the way up because we could be turning around and heading all the way back Up to the opposite of the channel on the monthly So there's nothing to do. There's nothing actionable with that right now, but it's important to note Let's zoom in a little bit and look at the weekly So on the weekly we can see that we clearly had balance in the market right here Okay, we broke out of that balance We are now coming back right now today to test that breakout from that balance So again, that is nothing actionable here today But if the market makes a low today turns around and reverses, let's say we make a higher high tomorrow That would be an indication to me not to fight the momentum up Because we just came back to back test the breakout from this balance and we could get a lot of access to the upside Okay, so nothing really actionable there either What about support and resistance levels, right? I'm looking at this chart and I'm asking myself if this is just a back test of the breakout Where will the market find that support? So all these highs start to jump out at me, right? Anywhere in here is where the market could bounce To get continuation to the upside Again, that's on the weekly time frame Okay, and then lastly let's zoom in and take a look at the daily time frame And see what indications we can get from there Well, we can clearly see the momentum straight down Okay, what jumps out at me about that momentum? It is going very very far very very fast Okay, so we don't fight momentum. There's no reason to go long right now As long as we still have that momentum We should only be looking to go short We should only be looking to take trades in the direction of the momentum But again when we get signals that the momentum is over This much of a move down this quickly will need to retrace so starting with the monthly Zooming in on the weekly and on the daily now We have three times in a row got a confirmation that the selling isn't over But that as soon as it is the market is positioned for a flip to come back around and balance off some of this excess So that's just one more thing to make note of All right, now let's look at the nq chart same thing Starting with the monthly Yeah monthly doesn't look good. Looks like it needs more of a pullback Whether you're looking at it as a channel Like the es Or a breakout of balance That needs to come back and back test Both look like the nq has further downside continuation We are sitting right on top of some potential previous support right here But that's about the only thing to hold up the market We can also see on the weekly time or sorry on the monthly time frame the nq has had a lot of excess We'll call that One two three four five six seven months of excess Not likely you're going to instantly balance that off and then reverse and head higher So that is also a little bearish to see Step into the weekly Same thing just feels like we have not pulled back enough To really test previous support You have momentum on the weekly But you also have this balance area here We tried to break out of it failed came back in Rotated to the opposite end and we have now gone back again to the opposite end So on the weekly time frame There is still momentum down and a higher probability of continuation lower But if they reverse it they could head back up to that opposite end once more And then we'll zoom into the daily Yeah, so the thing again that jumps out to me about the daily If they can magically reverse it today if they can magically turn this thing around They can create momentum to the upside But the higher probability in my mind is the single prints on the daily will likely need to be backfills So I would say both markets still have momentum to the downside Um and the es is positioned for a bounce and reversal Whereas the nq is not not yet So I think we have some more selling to come So the nq also had a spike down Nope not quite a spike So the nq didn't have a spike down, but it does have a gap down So both markets are bearish with a gap that needs to fill The nq is looking to try to fill the gap to 14 8 58 If it can get there does it get resistance at yesterday's low? Or does it just continue to the downside does it get resistance at friday's low? Or do we pull back up into friday's range? If we find resistance at friday's low or we fail to even get to it Both of those would be a gap and go scenario Which would be bearish for continuation lower And only if we were able to get back up into yesterday's range And spend some time and bring in some volume would things get neutral I do declare I am a bear Sean says do I ever take trades pre-market? I do not Speaking of which I haven't even opened my trading software yet. Um, but yeah, no, I don't take any trades pre-market Because there's too much uncertainty My expertise is in trading The regular trading hours like from market open until market close That time frame is where I have gained my expertise where I have put in my years of watching how the market moves I know how it moves at that opening bell When there's a gap down like freaking clockwork I can tell if it's going to be a gap or go generally pretty quickly Today, my guess is gap and chop Meaning we just grind around inside the lower end of the overnight range Um, and I will be able to recognize what's happening Very very quickly like within a matter of a minute of the market open I'll be able to have some kind of edge now I don't know yet whether I'll feel confident enough to enter a trade Maybe it'll be a trade to fill the gap Maybe I'll be going long to get back up to yesterday's low looking to take profits there Or maybe it'll be a gap and go trade. I'll be going short Looking for continuation to fill the gap down to 43 25 With my stop back inside yesterday's range I don't know yet. Which of these two trades I will want to take this morning But I do know it'll be one of these two because of the gap down It's either going to be a gap fill or a gap and go trade And so all I have to think about all I have to worry about is what happens when that opening bell rings Watch the chart move Sense the tempo the speed, you know, how um How much Participation is happening look at the volume right how many contracts are trading hands and at what levels Where is the support and resistance? What happens when we get to support or resistance? Do we just tag it and turn around and head the other way or do we grind and grind and grind into support or resistance? All of these pieces of information Will give me an edge to understand whether I want to take my long gap fill trade or my short gap and go trade Okay, but I have no edge right now pre market I have no idea what's going to happen until that opening bell rings And so you say well, charles, what if you're convinced it's you know earlier You were talking about a gap fill in the market was down here Why not just buy right there and then see what happens when the market opens? Maybe it fills the gap because that's guessing that's gambling and I have never found a way to consistently win Notice the word consistent to win regularly by guessing an outcome What I do find works consistently again and again and again Is having the patience to wait for the information? And then trust whatever the information is So if I'm getting signals from the market of a gap in chop To act the way I should act in gap and chop If I'm getting the signals for a gap fill to act the way I should act in a gap fill And if I'm getting signals for a gap and go to act in the way I should act in a gap and go That's the edge waiting for the information and then taking action as soon as you have it Good morning. John s good to see you New culture says do you go back in time to draw those spike open close gap lines? No, I do it in real time So I would have marked on Friday You know at the end of the day, I would have marked that as a spike down A base of a spike down at 43 62 And I would have said to myself, okay self Come Monday morning. Where do we open in relation to that spike? Are we above it? Which is the least bearish scenario? Are we inside it? Which is bearish or are we below it? Which is the most bearish? That would give me an insight this morning right when I open the chart To be bearish as long as we're below yesterday's low Paul good morning to you Laura good to see you I'm sorry if I'm saying your name wrong Rui or Rue He asks in momentum down trend Does it mean I should only trade momentum or can I look for reversal before momentum? So Today is a great opportunity of that Generally, you always want to trade in the direction of momentum, right? That is where you'll always have an edge But that doesn't mean that it's impossible to have an edge any other way So for example this morning we have a gap down So there is a scenario where you could go long To fill the gap to get back to yesterday's low Now you wouldn't want to be going long to try to get some big move to the upside because that's not what momentum is telling you But you can have momentum down on the daily and still fill the gap Right, so you're not really fighting momentum looking to just get to yesterday's low. That's not fighting momentum Right, that's it's within the context of daily momentum that if you gap down you will likely fill that gap so That's the only sort of time I would suggest a trade against momentum Is if it fits within that understanding? So we've got momentum on the daily You can take long trades as long as it fits within that. So that would be for example A gap fill trade or let's say we got a gap and go Let's say the market opened and it spent like an hour going sideways And then it finally starts to head lower Right, whenever you get cessation of the trend intraday Well, then sure you can go long and short Even though there's momentum down on the daily because intraday the market is likely to go up and down So it's all contextual As to what trades you take Good morning, pavel And then roux says or trade pullbacks of the momentum. Yeah, like I said, those are tougher to do You will if you track it in your trading journal, you will find trying to counter trend Trying to take the pullback trades Will be way you will win way less often than buying the pullbacks. So if the market has momentum down Let's say we get a gap and go and the market starts to head lower today It will be so much easier to go short and take profits at a lower level Then it will be to buy and try to take profits at a higher level It just I'm just telling you over a series of trades over a hundred trades You will make way more money going with the momentum than trying to fight it At least in my experience Trader jbr says what is the platform on the left? The gaps are dark blue So it's a little confusing because we have we're in a gap inside a gap Right now, but the the chart over here on the left is a market profile chart from a company called window trader The blue boxes that you see that is what we call the value area Okay, so there's This one here is the value area from the overnight over the weekend This one is the value area from friday The gaps are just manually drawn. So this level that you see right here This was an old gap that we never came back to backfill And once the opening bell rings, this will become a gap That will need to be backfilled And you'll see a little red line like this Showing you where that gap is but the opening bell has to ring first Frito says i'm guessing the six nine high is an old contract correct I don't change the levels once I put them in there Sharif good morning to you Yanis in the house Rui Gotcha For portugal welcome David g in the house Yanis question if possible. What time frame is your chart on the left? So This market profile chart Is splitting things out between the regular daily the regular trading hours during the day and the overnight So the ones that look kind of purplish. That's the regular trading hours. So this one was thursday The ones that look light blue. That was the overnight thursday night And then this was friday and then this was the weekend over here You'll see once the market opens. I then look at them in 30 minute time frames But for now we're seeing the daily because the market hasn't opened yet Speaking of which market opens in two minutes Smash that thumbs up if you have not yet Brings you good luck in your trading. That's what they tell me. That's what they say Um our pieces but do you use a pullback to open a contract in the momentum direction? Yeah, that's that's exactly what i'm saying. So if let's say the market has momentum down Right, it's trending lower. You are always better off selling at a higher price targeting the move down Rather than trying to buy at the lower price targeting the move up So if the market has made its move down You don't want to be thinking I should go long right now for a bounce You should be thinking where do I want to go short? Right, where is the next resistance above boom? Let me get short there so that it keeps going You want to trade in the direction of the momentum? One minute to market open There it is All right, so we are opening with a gap down The first order of business for the market is to try to fill the gap To try to work its way back up to 43 57 Friday's low and we will look for resistance there If the market fails to get back to that low That is a gap and go or if it gets to that low and it runs out of steam right there And then starts to come back down that is also a gap and go which is bearish for continuation lower If it gets back up into yesterday's range and it starts to spend time up there and bring in volume Then it's neutral. We look at it as a chop zone But for now we are bearish as long as we're below 57 Looking for a gap fill bringing the sellers Looking for a gap bill All right, we'll zoom out a little bit with uh Book map here And just kind of get an idea of where is the largest nodes of liquidity Well, we can see we have a large node up here around 65 Okay, we have a large node down here around 35 And basically about the same in between on both sides of the market So that looks like gap and chop for the moment We'll be looking to see does one of these two larger nodes Start to get thinner and thinner and thinner while it's new volume starts to build new liquidity starts to build up above or below That'll give us some insights Gap and chop I am looking for some support now around 43 40 There is a node of liquidity there. So that will either disappear It'll either spoof, which means the traders that we're targeting it will get squeezed Causing a bounce or it'll hold as support causing a bounce So either way, I I suspect we'll get some support here Also, once we dip below the overnight low Once we dip below 43 38 that will bring in a bunch of new sellers So if the market wants to chop if it wants to go sideways for a while here in the gap Before it makes its move it should find support at 43 40 And then try to come back up through the opening price Rui says How long does it take or how long do you have to wait for confirmation? With your experience, it should be within the first 15 minutes or can it take hours Generally if the market wants to gap and go like it has a ton of momentum and it wants to go lower It will do it relatively quickly. It'll do it. Let's say in the first half an hour of the day If not, it's likely to be gap and chop, which means could be hours of going sideways It really just depends. So the important levels to watch right now Is this support that I pointed out at 43 40? And the gap fill at 43 57 Doesn't matter how long they have to bounce between the two. What matters is when they get there If they come back and fill the gap, do they get smacked down? When they get down to the support, do they get You know support do they bounce that's what's more important How how much time the market has to spend going sideways between those two levels doesn't matter So one thing I'm noting here The market moved lower It found support and it's now pushing its way back up through the opening price So it hasn't quite gotten through yet. Well, there it goes. So now that it's through that increases the odds They want to try to fill the gap So I look over here at the ticks chart, which is a market internal And I see that we opened all the way down here at negative 1500 We've worked our way all the way up to negative 500 But we are still just right at the opening price So what does that tell us that is bearish to see it tells us that the buyers here Are just shorts from the overnight that are taking profits and not new buyers entering the market So that is less bullish to see or one might describe it as straight up bearish So they are trying to fill the gap But there is a higher probability as soon as they do they're going to run out of steam and come crashing lower What would change your mind charles? What would convince you that that's not happening? Well, if the market works its way up to yesterday's low The ticks work their way back up to that zero line and then they can stay above it Whilst keeping price inside yesterday's range that would change my mind But right now this was just signal like number four of bearishness Momentum on the daily signal one spike down signal two gap down signal three weakness in the ticks signal four All of this is telling me that the the bears will likely take control today They just have not done it yet As we gap and chop it up gap and chop Another bearish signal looking at the book map. We can see the liquidity up here is getting thinner While this down here is staying the same So slowly but surely there's less and less business to be done above price and more and more to be done below And that liquidity will act as a magnet So that is also bearish to see as we cap and chop it chopity chop BBM says choppy day is in store. I believe Could be wrong No, it's possible. It's certainly possible. Again the way it would happen first. We would fill the gap First we would get up to yesterday's low We'd pop inside yesterday's range We'd just go sideways inside of there and then we would turn this node up here around 43 71 Into resistance that could lead to a whole day of sideways Right just basically bouncing around in here That is possible To me that is the least likely scenario What is more likely the number one most likely scenario is that we continue lower The second most likely is that we do a little bit of that chop, but then reverse Higher or break lower from there and the least likely scenario is spending a whole day going sideways And the reason for that is just because of what we talked about during the top down conversation We haven't quite gotten To the lows that I would expect us to find that that larger bounce So the odds of just having all this momentum and then just stopping at some random point Doesn't make a lot of sense Especially with that gap below Good morning Gino ES trade monkey Alyssa Nap bust a move Mike who thinks and ken says the nq gap is filled Hey, nq gap filled. Okay. So nq looks more like a choppy day unless they just left behind a weak low. Oh They did Those silly silly bowls Okay, so this is the moment of truth for the nq whether we find out do we get resistance right now around 148 58 And continue back down through the opening price The more time and the more volume they bring in inside yesterday's range the less bearish it becomes Okay, the more likely that we're just going to go sideways But if we get smacked down right now that would be bearish as a gap and go And we have a weak low acting as a magnet So do the sellers step in Good morning 18 siri And laura has I don't know what that face means. Is that surprise or shock? All right, just shit myself. What does that mean? All right, so the gap is now filled on the es as well. So both markets filled the gap So that gives any long traders that we're buying in the morning Looking for a gap fill a chance to start taking profits here And any stronger hand sellers that didn't want to fomo in at the lows a chance to start selling resistance So we are looking for the market To bring in sellers here If not, we'll have to change our tune Okay, this is not a reversal. We left behind a weak high and an iceberg up there So they're just pulling back looking for a bounce To test uh friday's low once again Laura says long, uh, I wouldn't be long anymore If you were long, this is the place to take profits and look for more information Highest a week, uh, andrew says given the current scenario does shorting the open make sense Or is that just trading chop? Uh, in my opinion shorting would make sense. I wouldn't do the, um The open I would short the resistance right now You could technically do a stop sell at the opening price if it came back through So you like get in your short right there with a stop above whatever the high is that is a trade actually But you know, you got resistance at yesterday's low You know, you got resistance at the base of the spike down If you want to get short for a gap and go Getting short in the resistance is the place with the least amount of risk But if you wanted to be really conservative, yeah, you could sell the opening price On the pass back through Okay, so now we've got a good high with good excess and good taper And we are getting resistance at yesterday's low. So that's a little bearish to see Can the sellers take control of the market? Can they slap the ticks back down below the zero line? Another way to think about it is like the buyers who were buying earlier this morning We're buying to fill the gap. So now the question is are there new buyers inside yesterday's range Or do all the buyers from earlier take profits and then the market gets smacked right back down All right moment of truth This is the last chance for the sellers to take control of the market and smack those ticks down Getting price back down below yesterday's range If the market starts to spend time above the base of the spike that is less bearish And increases the odds will go sideways for a while So they really need to smack this market down now All right, they're just stalling waiting for the next tpo to print See if they can bring in some new buyers from that Here we go Man, they're doing this in a tricky way. Okay. So now The potential is that the market is going to have a move up from here They just created a poor high. They will need to repair that poor high Also the more time and the more volume they bring in up here inside yesterday's range The less bearish it is But I think it's all a fake out I think they're going to take us up just to take it right back down So I am bearish but cautiously so now I'm waiting for them to repair that poor high and then see what happens If they repair the poor high and the buying continues, I'll admit I'm wrong and go neutral for the day But I have a feeling this is just a little trick A little bot shenanigans Just to squeeze a few more sellers and then take it lower Well, I wish I had more insights. I could give you guys moving forward here. We got some questions Busta says, do you have a video explaining your market profile setup? I have a whole course Explaining it if you head to pirate traders.io, you'll see the e-course there Breaks it down into about five hours worth of videos going in depth on everything Superdrive guy says Um, how long do your typical trades last? How many points just trying to get a feel for your analysis? Um Generally, I I take just a few trades a day and I sit in them for hours at a time So the gap and go trade right now You know, I could be sitting in it for the rest of the day until market close It'll just depend it'll depend what happens So some days I take lots of trades. I take them, you know, it's with small ranges I'm just trying to grab a few points here and there because it's a rotational day. There's not a lot of opportunities It's a tight range. There's no momentum Whatever the case may be and then there are days where there is a lot of momentum Where the market could make a huge move. It could make a hundred point move or whatever the case may be On those days, I stay in a trade as long as I can and squeeze it all out But one thing I would say just to respond to that question is Don't try to find people online Who's trading strategy you can copy that will never be profitable for you. It will never ever work A much better way to do it is to learn to read the market yourself Learn how to understand what's happening during the day as you watch the market move whatever market you trade Become an expert in understanding your market What it does why it does it how it does it what levels will it do what it's going to do And then once you have that expert level at reading a market The trades will just come to you. You will just know So for example for me right now The best trade for today is a gap and go trade that is a short that is targeting getting down to 43 25 Okay, but I have I must accept because of what just happened with this poor high Right, I must accept that probably we're gonna grind for a few hours first Before we head down there Now I could play the game of trying to buy support sell resistance sell resistance buy back support I could play the da da da da da da da da Trying to get in a trade here trying to get in a trade there getting squeezed out moving my stop doing Or I can just say to myself. Okay self You know, we're likely heading down to fill this gap today because of the daily momentum Okay, and you know, we need to first come up here and repair this poor high So the better thing to do in this moment were to if you're already short Right, give yourself a nice wide stop Or Get short on the repair of the poor high with a tighter stop I couldn't have told you that at the opening bell this morning I would have had to see the way the market moved Watch the way it grinded watch the way it came back up into yesterday's range It stayed there for exactly the moment when the new tpo printed it created the poor high I like I've seen this movie before I know what's happening Which is they're gonna grind and grind and grind and grind right here on friday's low Probably for hours and then out of nowhere. They'll take the market lower And so that having that understanding Then I figure out how to trade it. How do I make money off of that is going to happen? Right When you think like that when you practice the skill of learning to read a market Understand what the market is doing and then you worry about how to make money off of it And I mean on a day by day minute by minute basis You wait to see what the market's doing and then you take action based on what it's doing You'll make a lot of money and you'll be very successful It's hard Because it's it's not simple But that's the better way to do it So I can't teach you a way to trade But I can teach you how to read a market and understand what it's doing And look for those opportunities to take trades Then it's just a matter of practice Screen time from there All right. Well, that's it. I mean, that's all I can give you guys to me. This is bearish Um as momentum on the daily I do believe we are going to at least try to get back down to 25 But I don't think the buying is over. I think they're going to come back for the high at least one more time Get a little poke up there and then they'll do it So I'd say we're looking at chop for the next few hours Inside the overnight range Um, what would convince me that the market is going to head lower without repairing the poor high would be if we get back below the opening price 43 49 and we get new sellers there Well, then The poor high doesn't matter anymore because the momentum is to the downside Okay With that, I will say goodbye. If you are a member of the brigade head on over to the brigade stream I'll see you there in about two minutes. If you're not a member of the brigade. Why don't you join? It's only 10 bucks and we could hang out like this every day Something to consider Thank you so much and we will see you here next monday morning Bye