Alkaline Deep Charts (Setup + Active Psychology + Levels)

Good morning everyone! I hope you are all enjoying your week in markets and are gearing up for a new trading day.

There's a lot I want to talk about, but I thought we should talk about it in a different way than my normal articles. Let's walk through the charts together!

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With that said, let's begin charting!

(For Reference: I do 80% of my overall charting in TradingView, however let me know if I should make more charts in MooMoo! The reason for using TradingView is the format and the indicators I can use. I also paid a good amount of money for the Pro version so I am going to use it haha)

You can find the SPY chart by searching it under Symbols in TradingView.

You know how I like my charting layout

I am going to keep the Horizontal and Vertical grid lines while I chart

Before I begin, I want to mention the inverse head and shoulders we talked about, but I am not going to include it on the chart because it already passed and we know that it played out.

Therefore, I am going to focus on new patterns.

Whether you want to start the rising wedge from the lows, or from where the top of the wedge formed is up to you. Regardless, this pattern has been printed on the charts no matter where you start the lines.

On the left hand side there is a section of tools called "Lines". I am going to use the Horizontal Line and Horizontal Rays to mark where support and resistance is.

Horizontal Lines = Where the price has been before and after a move

Horizontal Rays = Where the price has been before, but has not been after a move

I am also going to add some text to the lines so when I look at them I know what they represent. Furthermore, I will lock them into place incase I accidentally move them when charting other time frames.

When you right click the line it should look like this

These lines are all great, however I don't want all of them to interfere when I am making more specific charts on the lower time frames. So I am going to make all of these except for the all time highs visible on the higher time frames only.

For example, the 2022 Lows I will limit to the Monthly. Weekly, Daily, and 4 Hour Time Frames.

So when look at the 1 hour time frame, all I will see is the 2022 all time highs and the current All Time Highs on the SPY.

Similar to the Support and Resistance lines we just charted, I want to find areas where the buyers stepped in and held up the market as well as areas where sellers stepped in and took down the market.

In order to do so, I will be using the Rectangle tool.

Again, I only want the most "upcoming" supply and demand zones on the lower time frames so I am going to change the visibility settings on the other zones to only appear on the Monthly, Weekly, Daily and 4 Hour time frames.

The easiest way to find Significant Levels is usually at prices which are divisible by 5, whole numbers, and retest levels or zones.

Like I mentioned earlier in the For Followers post, $500 is a significant level as not only is it a key area for the price to remain above the $500s, it is also a whole number and divisible by 5. So let's chart those with our famous Purple Horizontal Ray.

Levels:

$500 because of the price alone, but also because of the volatility involved at the 500 level.

$490 because it was an area of a buyer and seller battle. This tells me that it is acting as an area of support for the buyers. It could also serve as a net in case the price drops straight down.

$470 because it was an area of a buyer and seller battle. This tells me that it may act as an area of support for the buyers. It could also mean if the buyers lose this level we might be headed straight down to the All Time High of 2022 support.

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I want these lines visible on all charts so I will not be changing the visibility settings.

As I mentioned in a previous article, imbalances are large areas of volatility where the price action is heavily skewed to one side. In this case, we are looking for any buy side or sell side imbalances.

Here we have one possible seller side imbalance where the sellers took the tape and pushed the market down. In order to chart these correctly, the candle before the volatility candle must either have bullish price action or resulting in a bearish candle.

This candle had bullish price action, but the candle turned bearish. That is how we can tell there is a heavy imbalance of the sellers to buyers ratio.

These setups normally take a few days to playout.

The Followers already know I love these indicators.

Smart Money Concepts:

There are some heavy buyers at the lower $500 level into the mid $490 level.

EMA 20/50/100/200:

All above the current price, meaning we might either drop much further down (low probability) or return to one of the heavier EMA's such as the EMA200 at $507.48

VWAP:

The price is currently finding support at the 4 hour VWAP which could be bullish (mig-high probability)

There are two conviently placed sell side imbalance candles where some sellers are. The first is the $506 range and the second is the $515 range.

There is also a possible bull flag on the 1 hour playing out

You could also say that there is a possible inverse head and shoulders playing out and that we are at the head right now.

You might also be able to say that the inverse head and shoulders has yet to play out and that we are currenrly near the shoulder formation of the pattern.

Typing this feels like deja vu if I am being honest.

If my deja vu is correct, then this pattern ends up being more of a cup and handle

However, my deja vu is also telling me we will see more downside.

Regardless, if we push up to the where the sellers are, that will break my deja vu and the head and shoulders pattern with 80% probability.

Buyers need to close above the possible 1 hour bull flag for more upside.

Here's a tip for those who are getting into pattern or technical based trading. The 15 minute shows the most confident patterns and trends intraday. This is because of the amount of candles printed and the patterns that form. The 1 hour only has 9-10 candles to print on the chart, where as the 15 minute has 25-26 candles. The 15 minute also shows more structure with respect to volume and volatility where as the 1 hour will mostly show volume and volatility.

Essentially that is why patterns are rare on the 1 hour and 4 hour charts but play out with more confidence. Inversly, that is also why patterns on the 1 minute and 5 minute are more ffrequent but less confident.

I will make a For Followers post on this later on so drop a follow if you want to understand more of what I mean.

The price has reached where the sellers are from the possible 1 hour bull flag. This would be a great chance to see a Retest and Rejection off the bull flag for more upside. It is also a great change for the buyers to sweep the sellers for more upside. The 100EMA is right above the sellers acting as resistance, but that can easily be claimed if the buyers step up here. The VWAP is acting as support for more upside.

The 1 hour possible bull flag is translating over the shorter time frames where we can see a retest and rejection occur already on the 5 minute of the 1 hour pattern. If buyers can take out these sellers, we should see more upside. You can see that we are currently trying to break the high of premarket. This is a bullish strategy known as an intraday gap fill. In this case, it is to the upside. If buyers can claim the level, the price might get bullish quickly. There are sellers at the $504 range, which the price might be trying to reach. If we can close above the opening price on the higher time frames as well as the 5 minute chart that would give me a high confidence of more upside.

There is another possible bull flag on the 1 minute. If buyers can keep up the price, it could play out for more upside.

There are two areas of quick supply and demand. If the buyers can keep the price above these levels we might see more upside. If not, we might retest the 1 hour bull flag which conviently lines up with the VWAP and the time in which the market has elapes so far. If we retest the VWAP around 11 oclock NYC, that perfectly matches up with the 1 hour bull flag for a retest and rejection. However, as the market prints candles, the further away we get from the 1 hour bull flag the more confidence of upside, if we retest the 1 hour possible bull flag towards the end of the day that would make me less confident of more upside.

I hope this article was helpful and that I was able to show you a bit of how I do my charting! I want to mention that this style of charting is applicable to all charts, not only the SPY. Try it out for yourself and let me know if it works for you!

Thank you for all the support and new followers, I am grateful to be able to share my ideas, charts, research and more in the markets to a larger audiance and I am bullish on 1,500 Followers!

At the time of writing, SPY is at the $503 level.

If you want all of my TradingView charts, there is a 50 Likes Challenge that is still occuring! I always update my charts so if you want them all for free, drop a like on this article.

Thank you for reading and I hope you all enjoy your day in the market