How To Engage Price After Holiday Volume Days

The speakers discuss market movements following a holiday, emphasizing a cautious approach by using paper trading to gauge market sentiment. They note a 100-handle premium gap opening and analyze price action relative to Friday's closing. Key elements include monitoring a wick's half, setting stop losses just above the second wick high, and aiming for sell-side liquidity within a suspension block, which is also a discount array. Nasdaq is observed to be softer than ES. The strategy post-holiday involves starting with one contract, even in paper trading, to align with price expectations. The importance of observing if the "sibi" (likely referring to an indicator or specific price level) remains open, even after retracement, is highlighted. Liquidity resting below a low and full gap closures are also points of interest. The speakers review a past trade on August 28th, where they traded into a new week opening gap, observing how bodies of candlesticks didn't explore lower, indicating a lack of interest. They note discount sensitivity and a rally into Friday's fair value gap, followed by a retracement. An entry at 595.25 with a stop loss just below a candlestick's low resulted in a small heat of about 10-20 handles before the market rallied and took out highs. The rationale for paper trading after a holiday is explained: markets can be "wonky" with slow starts and reduced volume, making it prudent to avoid risking capital until kinks are worked out and investor apprehension or laziness subsides. The goal is to get a "pulse" on the market. Further analysis reveals that bodies of candlesticks didn't touch or close above/below the midpoint of a suspension block, suggesting the market might pull deeper. A close above a specific encroachment would indicate a likely trade back to 9:30's opening price. The market's "heaviness" when trading into the lower half of a "semi mouse hole" is noted, predicting a move down into the new week opening gap high. The importance of taking partial profits when new lows are created is stressed. The discussion concludes by reiterating the cautious post-holiday strategy and the successful execution of trades based on premium sensitivity and specific price action rules.