Revised Model Wednesday 7.13.22
Updated
Normal Wednesdays are trending with a pump til 10, and then drop to a chop at 12:30. Even if price action is not a match on Wednesday, it is always a good idea to avoid the historical chop. I will grade and score the model at the end of the day Wednesday.
Tomorrow should be very interesting with CPI data being published. Happy Trading!
Tomorrow should be very interesting with CPI data being published. Happy Trading!
Trade closed manually
I ran a Kolmogorov-Smirnov two sample test. The result was a dissimilarity of 47%. If you normally trade on Wednesdays, then you know it has a reputation for being "whipsaw Wednesday" with choppy action. Today's response to several weeks of lower volume and a high CPI led to a huge spike in price and volume. The Standard deviation in the two sets shows that the model is typically flat (CV - .3%) whereas today's actual data has a CV of 1.5%, which means the data points are further spread apart (which represents the huge price action we saw today.Because the Dissimilarity was so high, it is likely I will exclude this data in the model and likely hold onto it to build a separate pattern. Or in this case....big news Wednesday pattern -- CPI data/etc.
This day's match was a bust, but that was fairly obvious after the 1000 AM swing point. The morning open was a good match though with a strong move up, which shows the model continues to have good morning reliability, and the chop zone held true to its word as well.
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