So, it turns out that the question we are asking is that this L x is equal to some v and if you want to solve for this from our knowledge of linear algebra we already know that we need L to have a non-trivial I mean to have a trivial kernel this has to be non-singular. Now, is it possible that this L does turn out to be non-singular or singular which is it? Can this L ever be non-singular? As we shall show you through arguments and through the description of another matrix related to a graph that this L must necessarily be a singular matrix you cannot help it for a simple graph it must be singular and therefore, this problem will not have a unique solution until and unless you decide to earth one of those node potentials and consider it to be of base datum otherwise there will always be something sitting in its kernel ok. So, this will happen to have solutions but you will have multiple solutions all right because this after all obeys the laws of physics you see. So, that is where your abstraction goes you will always have a solution to this problem after all I mean if I give you node numbers there will be multiple possibilities. So, earlier I gave you the node potentials already and I told you that these are the edge potentials here that you have to determine. Now, these edge potentials are the unknowns and you want to find out this can you uniquely fix it up then you will have to invert this matrix somehow and we will next show that this matrix is never going to be invertible for a simple graph ok. For that we need another description of the Laplacian up until now we have seen that the Laplacian is given by D minus A degree minus adjacency. Now we will define another matrix. So, let us not take a regular or a complete graph now. So, let us just look at this graph. So, that just to make things a little more interesting and now we will define a matrix called the incidence matrix. So, the incidence matrix has a size where the number of rows is equal to the number of vertices. So, every row of the incidence matrix corresponds to a vertex and it is not a square matrix generally the number of columns is going to be equal to the cardinality of the edge set all right. So, it is an we say n cross m where n is the number of nodes m is the number of edges ok and the how is it described? So, again I will not formally define it it admits three numbers 0 1 and minus 1 right. So, what does this incident mean? So, every column of this incidence matrix corresponds to an edge and every row corresponds to a vertex. So, how many rows should this have 4 right. So, let me level them with 1, 2, 3 and 4. So, the first row is say for 1, second row is for vertex 2, third for vertex 3 and fourth is for vertex 4 and how many edges are there 1, 2, 3, 4, 5 ok. So, I will have to have ok let us label these also without the rounds 1, 2, 3, 4 and 5. Now, when I am filling the column for edge 1 I need to do something ok. So, it turns out that for given undirected graph the incidence matrix that you write and the incidence matrix that your friend writes need not be the same ok. Why? Where does that stem from? That stems from the fact that in order to write the incidence matrix remember this is not direction what I am going to assign to every edge is an orientation ok and this orientation can be completely arbitrary it turns out which is why I said that I might assign an orientation like this to this edge you might just flip it around. So, let me just go ahead and do this arbitrary orientation anyway. Once I have given an orientation now the incidence matrix can be fixed up in that. So, I look at for edge 1 the first column. So, it is the first edge start from vertex 1. So, the first position I write 1 where does it terminate at vertex 4. So, at the 4th position I write minus 1 and the rest will be 0s similarly the second edge starting at 4 and ending at 3 starting at 4 ending at 3 the rest is 0s. The third edge starting at 3 ending at 2 starting at 3 ending at 2 the rest is 0s the 4th edge from 2 to 1. So, 2 to 1 the rest is 0s and the 5th starting from 4 to 2 4 to 2 ok. So, that is my incidence matrix. Now, you could have given any arbitrary orientations and these signs would have flipped. So, lots of possibilities there right. In fact, every one of these edges can have two orientations. So, it is 2 to the cardinality of the edge set that many different combinations you can have, but it matters not. I mean I do not even care about the fact that this is not unique why? Because just like the degree and the adjacency the incidence matrix paves the way for a construction of again the graph Laplacian. Again I will not prove this very rigorously, but I will show you why it has to be true particularly through this example. I will put it to you that this Laplacian that we have so far defined in terms of the degree and the adjacency is nothing, but E E transposed ok. We already know that the diagonal entries of the Laplacian are the degrees. So, let us just check the diagonal entries of this object should not be too hard. How do you get the diagonal entries of E with the E transposed? You take a particular row and take its inner product with itself. So, you look at any row and take its inner product with itself. It is always going to be 1 times 1 and minus 1 times minus 1. See whether your friend chooses a minus 1 here and a 1 here does not matter because in any case the 1 is going to get multiplied to 1 and the minus 1 is going to get multiplied to minus 1 right. So, what happens then? What can I just conclude from that? Laplacian of course, the direction matters not right. Why do you think this number would be equal to the degree? Because in this case look at this what matters at the end of the day is the number of non-zero entries the sign does not matter. When you take the inner product of any row with itself, every non-zero entry is counted as a 1 and that is how it appears the sum. So, basically the diagonal entries are going to only tell you the number of non-zero entries in every row, but what are the number of non-zero entries in every row of the incidence matrix? It is exactly whether you give this orientation into it or out of it, it is exactly the number of edges that are incident on that vertex. In other words, it is just the degree. So, at least the diagonal entries of this fellow are definitely members of the entries of the degree matrix. All that you now need to check are the off diagonal entries. How do you get the off diagonal entries of this? You take any row from here and take some other row from here and take its inner product. What will that lead to? What can what kind of numbers can you get from that? For instance here, if I want to find the one-third entry of the Laplacian, I have to take the inner product of the first row with the third row. See the zeros do not matter. So, it can only mean that only those entries which are both non-zero either of these vectors in this row vectors. If at least one, if this has a 0, where this has a 1 or this has a 0, where this has a 1 either way, the inner product it will not contribute anything to. So, the only way that this is going to contribute something to it is when both of them have non-zero entries at the same position. But by the very construction, when is that possible? When there is an edge connecting them, any two entries of two particular rows of the incidence matrix can have non-zero in the same position, they will only have 1 and minus 1. It has to be the opposite signs. And that only means that there is an edge connecting them, but that is the definition of the adjacency, right? That there is an edge connecting those two and there will always be a minus 1. So, we have indeed verified that every entry of this EE transpose, I mean I have actually given you a formal proof in words. If you write this down, this is exactly what the proof looks like. This example it is easier to visualize, but all you have to check is what turns out to be the diagonal entries of EE transpose and what turns out to be the off diagonal entries of EE transpose. And in either case, the off diagonal entries turn out to be exactly the entries of the negative of the adjacency and the diagonal entries turn out to be just the degrees of the vertices. So, just like you have d minus a, you also have EE transpose as this Laplacian, right? Now, why should this Laplacian necessarily be singular? Sorry? Of the Laplacian? Yeah. Yeah, right. Yeah, so yes, the determinant must be 0, but we are going to do go into something even deeper than that. You are right. That is a very straightforward way of seeing why the Laplacian must be singular, but we want to also inspect something a little deeper than that. So, you are right, absolutely. That is a very legit proof of the fact that the Laplacian must be singular, because its row sum is 0. And by the same token, its column sum is also 0, because it is symmetric in case of an undirected graph, okay? You can, you urge to also verify that and convince yourself it is true. That is done. That is a proof, legit proof. But the point is we also want to see something else, because we have learned this, you know, some fancy terms from this course like kernels and stuff. Let us try to characterize the kernel of the Laplacian with the kernel of something else, because that will help us go a little step forward, okay? So, I am going to claim that the kernel of the Laplacian is going to be the same as the kernel of E transposed. This is probably the one proof I will do a little rigorously, because it brings it, harkens us back to the days of formal linear algebra that we have been doing until the last class, okay? So, why is this going to be true? By the way, if I tell you that the Laplacian is positive semi-definite, would you agree? Yeah? Just look at the Laplacian, okay? And you look at any x transposed Lx. That is going to be x transposed E, E transposed x, which is nothing but E transposed x, whole transposed E transposed x, which is going to be equal to E transposed x and norm whole squared, which is greater than or equal to 0, yeah? So, the Laplacian definitely is positive semi-definite, yeah? Also, the Laplacian is symmetric, is it not? Of course, otherwise positive semi-definite, it does not, we would not have been able to use this. So, Laplacian is also symmetric. What do we know about symmetric matrices? Real eigenvalues, always diagonalizable, eigenvectors are all orthogonal, yeah? They provide you readily with an orthogonal basis for the entire vector space, yeah? All those beautiful properties that we have learned. But again, I digress a bit, back to this. So, first we will show inclusion. So, suppose V belongs to kernel E transposed, all right? So, V belongs to kernel E transposed. And what can you say? E transposed V is equal to 0, implies E E transposed V is equal to 0, implies L V is equal to 0, implies V belongs to kernel of L, yeah? One side of the inclusion is done. The second part, suppose V belongs to kernel of L, and actually the proof is here, if I may point out. It implies E E transposed V is equal to 0. It also implies V transposed E E transposed V is equal to 0. It implies E transposed V the norm squared is equal to 0. But a norm can only be 0 if the entry sitting inside its argument is 0 by the definition of a norm. See, all of this we have learned. So, I am not, which means that V belongs to kernel of E transposed. So, if I were to kind of characterize the kernel of Laplacian and show that it is non-trivial, it suffices to just convince you that the kernel of E transposed is non-trivial, yeah? Whatever sitting in the kernel of E transposed is going to be sitting inside the kernel of L, the Laplacian. So, if I convince you that E transposed must always have a non-trivial kernel, I am done showing that L must always be singular, okay? So, observe again from the example that I have just shown you, the couple of examples. What do you think about the incidence matrix? What is always going to be sitting in the kernel of E transposed? What is the sum of every column of E? Every column of E corresponds to an edge. So, an edge has a starting point, some starting vertex corresponding to which its entry is 1 and some terminating vertex at which its entry is minus 1 and nothing else. So, the row sum or sorry, the column sum of E or the row sum of E transposed is always going to be 0. So, 1, this is how I denote the 1, 1n belonging to Rn and 1n is basically just this object here is in kernel E transposed, yeah? It is true. Just like your friend said a while back that just take the row sum or the column sum, either case it is going to be 0, that is going to be in the kernel. So, it always has a non-trivial kernel, you cannot help it, but we do not just stop there. You see there is this question of something called a connected graph and a graph that is not connected and it is a in fact, the connected graphs that we are interested in. What are graphs used to model? Graphs are used to model interactions. If you have a bunch of people who are speaking French and a bunch of people who only speak say Hindi or English or any other language you might think of, do you think anyone from this first group can interact with anyone from the second group? No, right? So, there is no interaction. So, they are like two completely disjoint groups. So, if you want to model interactions, you might as well think of them as two discrete groups, two distinct groups and you might capture the dynamics or their interaction separately. So, if I model them as an interaction graph, do you think there is going to be any edge from purely English speakers to any member of the set of pure French speakers? No, right? This guy will say no, this guy will say OE, right? So, nothing. So, in that case that such a graph will always be called a disconnected graph, right? It turns out that there is a way of characterizing whether a graph is connected or disconnected by looking closely at the Laplacian and particularly at the kernel of the Laplacian. So, one thing we have seen is that whether a graph is connected or not, this all-ones vector is always going to be sitting in the kernel of the graph. It just cannot help it. It is just going to be sitting there, but it turns out. So, observe this line of reasoning very closely. This is very heavily reliant on what we know about symmetric matrices. So, if there is exactly one vector sitting in the kernel of E-transposed, it means there is exactly one vector sitting inside the kernel of Laplacian, by one vector I mean span of the one vector, right? So, it is a one-dimensional vector space. What does that tell you? That the nullity is 1, which means there is one 0 eigenvalue of the Laplacian guaranteed. If the Laplacian were to have more than one 0 eigenvalue, that is the algebraic multiplicity of the Laplacian or the 0 eigenvalue happen to be more than one, what can you say about its geometric multiplicity? Laplacian is symmetric, Laplacian. So, what can we say about symmetric matrices? All these diagonalizable. What do we know about diagonalizable matrices? Algebraic and geometric multiplicity must be same. So, if you only check the geometric multiplicity of an eigenvalue, you can check the algebraic multiplicity or if you want to check the algebraic multiplicity, you can also check the geometric multiplicity. It matters not. They are always going to be same because symmetric matrices like the Laplacian are always diagonalizable. Now, if you want to find out the multiplicity of the 0 eigenvalue of Laplacian, you have to find out the dimension of the kernel of the Laplacian because algebraic and geometric multiplicities match. But if you want to find out the kernel of the Laplacian, you might as well look for the kernel of E-transposed. So, you see immediately the dimension of the kernel of E-transposed. So, the dimension of the kernel of E-transposed, this is just the logic we are using, is the geometric multiplicity of 0 is equal to the algebraic multiplicity of 0 in what? In the Laplacian. Do you see this immediately follows from our reasoning, right? Just what I have explained so far. So, if I want to find out whether a connected graph can have a Laplacian whose 0 eigenvalue is repeated or not, I have to just look for what happens to the kernel of E-transposed for a connected graph. The point I am going to make is that for a connected graph, E-transposed cannot have a kernel of dimension more than 1, which means that for a connected graph, the Laplacian can have exactly 1 0 eigenvalue, which means that if I formulate the problem in this manner, let me search and because the Laplacian is symmetric, it has real eigenvalues, let me search along the real line. Let me look for the smallest non-zero eigenvalue of the Laplacian, that is going to be 0. Let me look for because it is semi-definite, let me look along the positive real axis. Let me look at the second smallest eigenvalue of the Laplacian. If that is also 0, then the graph is disconnected, but if that is non-zero, then the graph has to be connected. So, let us try and rule out the possibility of the kernel of E-transposed having a dimension more than 1 for a connected graph, why must it be so? So, if that is true, then there is another vector apart from the all ones on which if E-transposed acts, it has to be 0, but how is that possible? So, I will not go into a rigorous proof of this, but I will just convince you through an example here. So, suppose you have a graph like this. So, visually at least you understand that this is disconnected, group of two Englishmen and three Frenchmen or flip it the other way around if you like, whichever majority suits you, right? Disconnected groups. So, let us say this is 1, this is 2, this is 3, right? What about the incidence matrix of this? What happens to the incidence matrix? 1 minus 1, 0, 0, 0. What about this? This is the first edge I am talking about, ok. This is the second edge and this is the third edge. What is the second edge from 3 to 4? Let me give an arrow head direction first, alright? Let me just give an orientation arbitrarily as we have seen. What about the second edge? It starts from 3 and it is at 4. What about this? It starts from 4 and then it is at 5. That is all there is. You immediately see that this disconnected components, they can be split up into blocks such as these. Why is this important? If you just flip it around a bit, the E-transposed would look something like this. 1 minus 1, 0, 0, 0, 0, 0, 0, 1, minus 1, 0 and 0, 0, 0, 1, minus 1. What is so special about this partitioning that I have done here in the E-transposed? You see, you can get a vector which is 1, 1, 0, 0, 0 and you can get another vector which is 0, 0, 0, 1, 1, 1. Are these linearly independent? So, for every connected component on certain number of vertices through a proper ordering, you can always get and all ones of appropriate size and pad it with 0s elsewhere. So, the dimension of the kernel of E-transposed can only be more than 1. Again, this is not a formal proof by the way. I am just illustrating to you. You can generalize this. Argument is similar. I am just going through an example. So, because it is not algebraic graph theory, I am not proving this. So, the point is that the only way that the dimension of the kernel of E-transposed can increase from 1, it is always going to be at least 1, that we have convinced ourselves. But it will only increase from 1 only if you have disconnected components in the graph and the dimension is exactly equal to the number of disconnected components. In fact, it is exactly equal to the total number of components we say. So, when it is a connected graph, there is exactly one component. So, you will often see that this claim and now you will be able to recognize behind all the fancy parlance what it says. It says that the rank of the Laplacian matrix is equal to n minus c, where n is the total number of vertices and c is the total number of components. So, we have actually demonstrated that to you here. Because the nullity of this, this is the dimension of the ambient space, this is the nullity. So, this is the rank. It is the rank nullity theorem again. So, the nullity of this is exactly equal to the dimension of the kernel of Laplacian, which is the dimension of the kernel of E-transposed, from which it is very easy to see why such should be the case. For every component, you can cook up an all-ones vector of appropriate size and stitch them together and they are all guaranteed to be linearly independent. Because whatever this has once, the other fellow has zeros. So, at least I hope in a semi-formal manner you understand this result. In fact, this problem algebraically can be translated to the following. If you have a characteristic polynomial, when can it have a 0 eigenvalue? If the constant term in the polynomial is 0, when can it have repeated eigenvalues? When the coefficient of s also is 0 along with the constant term, right? So, if you have given the characteristic polynomial, you have to essentially check, if it is a characteristic polynomial of a Laplacian, you have to essentially check for the coefficient of s. And if you find out that the coefficient of s is non-zero, then such a Laplacian represents a connected graph. Because its multiplicity of 0 eigenvalues, algebraic or geometric is immaterial because they are equal in this case, is always going to be only one and no more, right? So, this is the beautiful connection, right? And in fact, the coefficient of s, if you dig a little deeper, how is the coefficient of s obtained? That is where you will find this application of this one result I had hinted at sometime back, this Cauchy-Binet theorem. It turns out to be the number of spanning trees in a graph. So, what is a spanning tree? That is another question then. So, a spanning tree in a graph is basically in a graph of n vertices. It is a set of n minus 1 nodes such that from every vertex, you can walk along these edges and reach any other vertex. You see, in this case, you cannot. So, I said a lot. Forget about the Cauchy-Binet theorem and the proof of the fact that indeed the coefficient of s, but it all fits together. What I am trying to say essentially is this algebraic graph theory is enormously reliant because you are going to be using matrices to represent objects such as these. If you understand matrices well and linear algebra well, you will find your way around the proofs and claims of this domain. So, before we conclude, I will try to give you an example of the so called consensus protocol, which is when agents or humans or anyone can interact with each other and arrive at an agreement or consensus. If they do not have any prior prejudices or biases, it turns out that they will always agree on some common ground and the common ground is exactly going to be the average of their initial positions or standings. So, I was extreme on this side of the spectrum and you are on the extreme end of the other side of the spectrum. We would all converge on the half way mark. If there are five people, it will be on the average of the five people's initial locations. So, that is the result. We are going to try and prove next.


In his book, The Grasshopper, Bernard suits claims that should we one day create Utopia, all we would have to do is play games. Once our material needs are satisfied and our anxieties quelled, what would be left for us to do but play, create, and indulge our whimsy? The Grasshopper in the title defends this position to an ant, skeptical of this absurd claim, who thinks some people would need to work. The Grasshopper, a strange blend of Socrates and Jesus Christ, always has an answer though. What would scientists do if they have all knowledge? While they would invent puzzles and problems to solve on their own, wouldn't the artist be deprived of the suffering that inspires expression? No, they could create drama within the safety of play, enabling catharsis. And the ant-like workers? Well they can always create tasks for themselves to solve, they can play at work. Seuss addresses many other conundrums and design formalism in the book. He defines games as the voluntary confrontation of unnecessary obstacles, suggests play is essentially intrinsic, not instrumental, and claims rules are both prescriptive and proscriptive. But ultimately, only important for the activity that they make possible, they are arbitrary. He concludes on the relationship between games and Utopia, this sentiment. It behooves us therefore to begin the immense work of devising wonderful games, for if we solve the problem of scarcity, we will have nothing else to do in Utopia. So Utopia is about play, at least according to the Grasshopper, and is really what defines us as a species. However, this presumes Utopia as a concept is universal and neutral, and that play is something monolithic and definable. David Graber presents a different vision for Utopia and play though, in his book The Utopia of Rules. He thinks we have a culturally mediated conception of both Utopia and play, and it's hardly a Utopian vision. We know how players existed in different guises through history, outlining the book The Ambiguity of Play, but every culture has its own idea of Utopia, which almost always descends into dystopia. Graber thinks our culture's version is one we are already creating in this world, a world of stifling regulations and submission to rules. In the book, he presents the iron law of liberalism, how policy meant to increase freedom actually creates more administration, an idea he calls total bureaucratization. Governments, corporations, and the military industrial entertainment complex are all fused into one network, a network that controls our lives through both subtle and explicit means. Our Utopian vision is one of bureaucracy. We see this in the hierarchies of heaven and medieval Christianity, to the valorisation of national identity, sometimes taken to extremes. Not only does this stifle creativity stagnate our sense of agency and control our lives, total bureaucratisation turns us into algorithms for a process beyond our control. In fact, our version of the Grasshopper's vision is seemingly very ant-like. We actually chastise true play, true freedom, we view democracy and agency as a threat to the natural order. He concludes by suggesting we need to unveil the true nature of play, which is not bound by the rigidity of codification, but as a transformative force of social upheaval. As an art form defined by rules but mediated by play, games are at the heart of the contradiction explored by both Sooths and Graeber. The paradox is palpably presented in the title of one of the most prominent books of design formalism, the rules of play. The authors of the book, Katie Salin and Eric Zimmerman, define play as free movement within more rigid structures, and there are also clearly defined types of rules.  In the art of game design, Jesse Schell used David Partlett's analysis to come up with even more categories. Rules are operational, foundational, laws, written, advisory, behavioural and house rules. Rules are what makes games games, they are the DNA of play. The problem, as we explored earlier, is that the idea of play and rules are themselves molded by the cultural context we exist in, they are not neutral ideas. In his book, Avangard Video Games, Brian Schrank says this of the definition of rules and rules of play. Saying play is free movement within rigid structures is itself a technocratic definition. Biologically, play's function is to reinforce an organism's variability in the face of rigidification. He then presents the idea that there is both first order and second order play. First order play is about observing the rules, they are meant to be adhered to and not questioned. Second order play though is different. It renders plastic the structures that first order play is beholden to. This is where he locates Avangard play as existing, a space where we can reclaim a new definition of play, not mired by regulation. Schrank outlines how games are a continuation of the Avangard art movements of the last century. They critique games as formal systems, unearth their rules and deconstruct them. For example, the Dada movement would often be self-referential and reveal itself as artifice. The situationist, on the other hand, used reality to create versions of utopia, drifting in cities to create new magic circles. This idea of play giving a glimpse of utopia is explored by people like Bernie DeCoven in the New Games movement and in his book, The Well Played Game. Play can break free of the magic circle and serve its original purpose. It can start to envision new versions of reality, a real utopia, by rethinking our original purpose, by rethinking our relationship to rules. Learn the rules like a pro, so that you can break them like an artist. This is what Picasso told us to do, but how would we read this in the context of games? We need to establish a formalism well enough to break it, so how do we break free of rules not transparent to us? In his book Essays on Algorithmic Culture, Alexander Galloway argues that games are artful algorithms that mold our behavior in particular ways. He identifies four moments in games, drawn on diegetic and non-diegetic lines. Essentially, he asks us to recognize that there is an inside and outside the games, and play exists in the interface between fiction and reality. What does interfacing with an algorithmic interface entail for us, though? He states, Video games at their structural core are in sync with the politics of the information age. Video games are allegories of our life under network control. He argues that the meaning of a game is not in its mechanics, or its rules, but in its allegory rhythms, its algorithmic metaphor, the allegorhythms of play. For example, civilization is not about strategic decisions or history, but about transcoding history into math, into an algorithm. We find ourselves back where David Graber left us, that play has become entrapped by the structure it upholds, and is now fundamentally submissive, not transformative. Does Galloway provide us an answer, though? He does, in the hopes of an avant-garde in games, a movement that redefines play from within by creating new allegory rhythms of play. Breaking the rules of play is not so easy, though. In The Grasshopper, Suits outnines three kinds of rule-breakers, triflers, who reject the goals of games in just a linger, cheats, who reject the rules but accept the goals, and spoil sports, who effectively reject both. Is this not just insubordination, though, a lack of discipline? How does one break rules with intent? These aspects of rule-breaking have been subsumed and harnessed by avant-garde gaming traditions, and can inspire new ways of thinking about games. In Mary Flanagan's Giant Joystick, a giant controller was placed in an exhibit requiring people to work together to actually play. It broke the rules of accessibility, and foregrounded the technological inevitability of controllers, forcing a new allegory of play, of improvisation, communication, and physicality. We can do this in even more subtle ways, though. In Yoko Ono's White Chuss, all pieces on the board are white, which makes it seem impossible to play. It requires players to be hyper-aware of their pieces, speak with their opponents, and perhaps devise new rules. It's an instrumental consternation. Getting players to think about how rules are malleable can be both mechanical or more thematic. In the puzzle game Bubba is you, you have to actually change the rules of the playspace to solve puzzles. You can make lava pushable, or even make walls permeable. Everything has been subsumed by the rules of the game. Games are now formalizing the breaking of rules themselves. In his book Sound Play, William Cheng argues that foregrounding the rules of music, a form of play, and letting people see how this can be manipulated, can invite subversion as a matter of practice. For example, let's take the game Thumper. Described as a rhythm-violence game, the game sounds disharmonious and grating. The game gets us, through play, to subvert the rules of music, like 4-4 rhythm, beat, and harmony. We are experiencing music in its purest form, but only when we do away with the convention of music that has been holding us back in the past. The formal realization of subversion is built into some of the most heralded games of our medium, whether it be the twists in Bioshock or Portal. We are being asked in the fiction of a game to break through its artifice. In his book Respawn, Colin Milburn extends this argument and suggests games are effectively science fiction. They are a speculative media that allows us to envision a new reality of rules. The book explores how iconography from Portal, how the cake is a lie, has seeped into real-world movements, but also how games are tuned us to the dysfunctional nature of rules and how they ought to be reformed. The culmination of the book is an examination of Final Fantasy VII. In the game, we are playing ostensibly as terrorists, but for the purpose of ecological stewardship, inverting moral categories. Playing the game is to be enmeshed in systems that perpetuate the very systems that cause catastrophe. We are back to the paradoxical nature of play in how it both creates and destroys, submits and subverts. Our entire world is a global network, but if we realize that we are complicit in the creation and perpetuation of these systems, we may be able to salvage play from the confines of its technocratic artifice. Once play is reborn, perhaps we can start building a utopia. The Grasshopper was convinced of the transformative power of play, so much so he was willing to die for it. This is what makes him like Socrates, a martyr for his cause. The irony here of course is that play takes a subversive and political tone, one seemingly antithetical to the utopia he was trying to create. However, maybe in this act we see how play is not so innocent, it is a process that enables transformation. It is unbound by the systems that pervade our reality, and can be a force that causes social upheaval. A utopia of rules may in fact be a dystopia, but if we locate the solution not in an outcome, but a process. Maybe we can create a version of reality that is more playful. A utopia at play.


Welcome, this is Melissa Armo with the stock swush and reviewing today's play of the day Ironically this went to the dream target actually went past the dream target dream target today in AAL which was a short We shorted this we got in and out fast, which is what I always do But the dream target was 13. I said to people in the room you can hold it if you want it actually broke 13 In fact the low of the day Was 1292 so this was very interesting because Earning season starts Friday. It's an exciting time to treat especially with what I do which is gaps But you know we've had some good place here leading up to earning season so I was very very happy with this and The market was going with this today, which was excellent But you know there's been so many times that the market has been chopping today was one of them too where you're in a Trade you're up a lot of money. It backs up. You got to get out fast I really think the key to making money consistently. It's the consistency that we've been so consistent. I've been consistent It's me. I'm the one running the room calling the trades It's about getting out fast In and out done and boom So, you know, that is exactly what I did here today and I'm going to go over it But it kept going back to you what you could have done you could have lowered the stop Or you could have put it at break even You know, if you want to try to give it to 13 because it never went back to where we took it Anyways, here it was beautiful Close yesterday at 1432 boom open in the morning here open at 1385 then we got in we were aggressive got the drop rally Held I said here. I said in the room. You could take more if you want to I'm not gonna be aggressive today I'm gonna wait till Friday. I'm not gonna go crazy But then I went And we got out quick, but it kept going So I mean you can still even be in it to be honest with you it's two hours and 20 minutes left in the day I don't know if it keeps going under the low, but it was a nice trade Nice trade and for those of you that don't know what I like to do I like to short so I prefer to short shorting is my thing I'm very good at finding the best gap every day and the best short Lots of volume in this nice short today good price point, too And you can plop on the size when you have volume and a cheap price point You can plop on the size of stopping this was so small too So really nice trade. I mean I could have actually more than doubled my money actually if I had held it But I still like the fast trades. I think in this type of choppy market That's the ticket to consistently make money. It's book a book a book it Monday Tuesday Wednesday Thursday Friday That's the way to go it really really is and I think that's one of the reasons why I've been successful So if you have questions, you'd like to learn what I know I teach it once a month in a class called the Golden Gap course I teach on that than how to rate the gaps and then if you take the class you are eligible to join the live trading room If you'd like to email me with information about upcoming class dates email me at Melissa at the stock swush calm Have a great day everyone


good morning welcome to this week's Wednesday webinar it's Wednesday the 6th of September and we're into probably into the month of September with a bit of volatility most likely so let us do the disclaimers as usual good morning welcome to this week's Wednesday webinar sorry I'm just having to mute my YouTube so I don't get an echo of myself in my ear all bookmap limited materials information and presentations are for educational purposes only and should not be considered specific investment advice nor recommendations trading futures equities and digital currencies involves substantial risk of loss and is not suitable for all investors past performance is not necessarily indicative of future results okay let us check everything is good yep I'm just waiting for the YouTube screen to change I think it's going to change now looks like ES is breaking down towards some liquidity but I'm going to restructure the the format of these webinars I've just got it on some bullet points here just so that we make the best use of this hour together so if I quickly move across to my slide for today I'm gonna I'm gonna break this down so that in the first 15 minutes we talk about education and ideas I think I've spent a lot if not too much time in the first month and a half of these webinars just really focusing on education education especially the supply and demand scenarios that I'll be commenting on live as we have trades that set up anyway so I'm going to limit my education and new ideas to the first 15 minutes only sometimes it might even be shorter the second 15 minutes we're going to talk about some really clear ETH setups that appeared in today's ETH session that's the overnight session third 15 minutes we're going to do the prep and context for today's RTH session and the for 15 minutes or maybe longer if we're lucky we will just have live order flow analysis and commentary of this breakfast session as we move towards the RTH okay I'm aware before I go into the first point that we do have some market moving information coming up so if we go along there at 8 30 today we have the the trade balance so that's a two out of three in terms of importance medium to medium high so we should get some volatility during our second 30 minutes if not before okay right let us move on okay the first thing I'm going to talk about today is ideas right okay this is just something that that comes into my brain and I just like feeding anybody out there some ideas to help with your own trading I mean trading is a business as I keep saying but one of the things that I may even spend a whole webinar whether it's on the book channel bookmap channel whether I ever do it on my own channel about journaling journaling is critically important both in terms of the live timestamp journaling you do during a session and also the review you do afterwards one of the problems with journaling is that you may end up taking a heck of a lot of notes I dozens and dozens and dozens hundreds of them and you may cover the same thing again and again so a question that I have and maybe it's a question that you've had yourselves is how do I how do I best connect all the the notes the journals everything else I've been taken so that I can find that information again and one thing I'd like to draw your attention to that is available these days is artificial intelligence or generative AI and there are a couple of ways that I have come across recently to do it so this is basically where you're learning from yourself which is the best tuition you can possibly get or you're learning from documents that have been provided by others you can use an app like quiver which is entirely free and has its GitHub page it can be linked from quiver app to feed it all the documents that you have and then ask the AI questions and get answers about those documents and the other alternative depending on what you use for your journaling I use a program called obsidian again it's free I've got all my notes journals etc it's like a second brain I won't delve too long into that subject here but one of the ways in which you can query that entire database of your notes inside obsidian if you do use something like that is through the use of plugins there are a couple of plugins that are particularly useful ones a chat gpt plugin and the other one is a plugin called smart connections so again you can have like hundreds or thousands of notes there might be journals there might be trade plan items there might be commentary on things that you're learning about the markets and you can use something like this smart connections to ask where where have you come across this before within your own notes and also to have it digest and summarize other things that you feed into that database so it's just a quick pointer on something that does pique my interest a lot I mean I've used AI quite a bit in the last few months partly on on graphics but also on on learning it's it's a very very very useful tool when you are programming anyway let us stop digressing on ideas and let us get back into into book map right okay education or quasi education as I call it there's a couple of things that I've been drawing your attention to in terms of things inside book map that can help with with the supply and demand type trades that I've been describing the AB and C type trade setups and today we're going to look at something else as well inside book map that I haven't used much I mean we've talked about market pulse but here on the lower panel we've got another market pulse our go and if I bring up the menu here is it the one that I'm using here is called volume pressure imbalance and if we blow this up I've got the absolute default settings on this and effectively it's doing a percentile based on how strong the delta is from its average say over the last x minutes so basically how strong is this move in terms of delta relative to how Delta's been tracking for the last little while so if we just have a quick look at ES in terms of how this comes up again it's exactly the same graphical settings as as the market pulse price I'll go but this one relates to Delta not price so that once it's crossed the 70 percentile threshold it goes green once it crosses the minus 70 percent threshold it goes red so in other words a strong down move it goes red so it's just another way of alerting yourself to mean reversion type trades I'd call them or maybe strength of one side coming in and backing that that up by putting Delta buying at market or selling at market as they as they push the market along so I mean if we just scan back and again I mean this is partly looking at it from a scalping perspective as we came up to liquidity here in in in ES up at their 4495 as we came back up there you can see very thin liquidity resistances it's okay and you get a clear green Delta signal there it's it's something I'm not going to comment it an awful lot on I'm just testing it out and again I'm since I do tend to reverse engineer and program these things I've also built one inside Sierra to analyze it so in Sierra I'm again having a look at it on a sustained basis of how much Delta is being added over X seconds and using a half life I mean if I go back to the settings on this one one of the things that does interest me on the way it's being coded is that it has a high half life period so that the Delta every 10 seconds is basically divided by two or halved so it becomes less relevant and for the purposes of the graph again it's just something that is worth having a look at or I like having a look at new ideas to see how best I can use a tool it it may be something that I don't end up using permanently but it's just something that is on my mind at the moment to see whether it provides more relevant information to the types of trades I take than the market pulse price change I'll go price change I'll go is very similar to any other oscillator and I mentioned this previously as well so for example if we were going to go through an RSI oscillator or a MACD oscillator the price change I'll go is pretty pretty similar to that in terms of extremes and using them to to fade a move or to give yourself a signal that strength is coming into that side so anyway that is my first 15 minutes I managed to go through in about 11 minutes so I will I will move on to next topic which is let's find some good setups in in in ETH I think I've got over 15 minutes which will be great because there was a fabulous setup I'm going to look at this one primarily for NQ and to describe how not to do it and how to do it and fortunately my trading view chart here I can draw as well but I'll hold off drawing for a second if you look in the bottom right of the screen and we have the trading view chart and you've got yesterday's low that is not correct that red line there in trading view that is not actually correct at all so yesterday's low and I'm just looking in Sierra yesterday's low was if NQ is 15 442 75 so basically 15 443 so if I draw a line let me time to draw again great just draw a line so 15 443 so effectively that was yesterday's low and you can see just looking in trading view that we came down smashed through it or smashed through it and then immediately rejected and that since then we've been grinding our way back up back up through the developing value area to the other side of the developing value so let's have a look at how this appeared and let's talk about different ways in which to to get this in terms of it this being a valid setup or not it is a valid setup because it is effectively a spring on yesterday's low so it falls into category C of the ABC trade setups that we've been talking about for the last couple of weeks but let's go back in time and have a look and see what we could have seen here bear with me because this is always a little bit tedious getting back to the the 3 a.m. London open in ES okay and NQ rather actually it's pretty best to bring it up in ES first even though I took the trade I actually took a couple of trades within the move back up and it is better to look at it in ES one perspective as we came down and and there's the German open about 2 a.m. and then the London open about 3 a.m. and if we zoom out vertically you can quite clearly see all I hope you can I was in a little bit better you can quite clearly see that the main liquidity was below so there was resting liquidity below and if we zoom right back into where this this came in effectively this came in at this kind of time which is around about the China open about half past nine half past nine to 10 a.m. 10 p.m. New York time Eastern time that they they flagged that they might want to transact at the liquidity below and then if you have a look so you take step one ES flagging clear resting liquidity below potential magnetism magnet down there and say you want to trade NQ and Q had that lovely level which we've drawn on trading view which was yesterday's low and it's just something I want to show you before we actually drill right into this if we and I put these into their own columns these are effectively 30-minute bars on NQ so every one of these vertical bars on this TPO chart in NQ is a 30-minute chart so as we were coming up we were up we were up here right one of the things that is interesting and it's something you learn with experience with NQ in particular and that is the one that I trade more of in the London Open session time that even though you know if we were about here coming into the German open London open and the and yesterday's low was so look about 70 points lower it is still incredibly easy or relatively easy for them to get it down there so you know you you might you know you might have been fortunate to get a short roundabout here and you would then have had an overall target you know a final runner scale type target of down here because of the the behavior of this particular market loving flushing out stops and one of the best places to find stops is at yesterday's RTH low there's often a bunch of stops just there and this was the scenario in this circumstance so it's just something that does play out a lot I mean we can talk a bit later about how we can examine these profiles for other other examples of where they might have found stops as well it's also interesting to have to have one quick look at this profile before we dig into that spring of yesterday's low if we have a quick look at the high which was formed pretty early at the at the Japan open at 8 8 p.m. Eastern time you'll note that it did not quite take out this pink line which was settlement and also yesterday's volume point of control in NQ so the so you had a confluence of two key zones there which are which often do happen to coincide just because an awful lot of volume is traded at settlement and it could not get up to and tag it so this was a failed kind of auction for NQ right at the Asian open and then it's basically been moving away with a yes towards that liquidity which was much much lower so it's just interesting that you have this clear area here you've also got a break in the profile just there which you could argue was a delineation of a value area and another value area and it basically had a fail breakup over that value area and then back down so it's just interesting that there was a clear failure there so we moved into trending action and it was a question of how far could they explore lower and we were given guidance by the resting liquidity in ES lower down okay right so let's have a look at some of the nasty games that they played and what you could have done right so the first thing to say is that NQ coming into the we have the M3 AM maybe I'll start using the pen now let's start drawing so bear with me while I try and get this right okay so we've got the London open here we have breakdown there we also have some nice resting liquidity here and we'll we then move into an iceberg but what's apparent here is that there is a lot of Delta and it smashes through the resting liquidity right at the London open so if we zoomed right out I've got to get back on cursor to be able to do it you can see it was quite an emphatic breakdown of liquidity right into the London open regardless of whether that was at 259 30 or 3 a.m. exactly that was a clear breakdown you've got a stop an MBO stop 131 a huge number for NQ at this time the day so clearly interested selling intent you can see the size of the buys by the way I've amalgamated these two into one column so I can get it wider for you but essentially this is the same as the three columns I had before I had the sellers and the buyers separated out in two columns but I've just done it one here so we can clearly see where value starts and ends so you've got a value delineation point there for example which did play a key role later so if I just flag in your minds 15 493 50 as a as a delineation in the value so yeah you could well have been brave enough to be looking for shorts or just correct in this scenario let me get rid of that so the first thing to the first setup would have been a test back to that large trade which is 269 that transacted with that liquidity that was the breakdown and we got very very close there so that there would have been trade number one right on 306 and the first target would have been this little retest of this trade here which is a hundred into resting liquidity which also has a by iceberg and at the time they already had about 60 on that by iceberg so it was a strong probability I'd call it that they would retag it so they did some so I'm saying that the first trade would have been a retest of that you could say I mean is this an ABC supply demand yes it is because if we zoom right into this trade and we have a nice little swing high there and we watch the microstructure it is a type C category it takes out that little swing high it also has strong confluence of the breakdown from the the extreme of the previous value coming into the London so that would have been like the best possible trade at that time to take and right here so you mean you tried to get in around about the 86 87 mark with a clear target of 78 so a nine point target very a six point stop six or seven point stop when we have this iceberg here and they were filling more and more and more you can see with the absorption indicator roughly how much was being filled you know you've got 60 80 50 so 170 what once you have one two three touches the probability it goes away from this being a demand zone to jumping straight up to being likely that it's the hammering at a brick wall and the more they hammered a brick wall the more likely it's going to burst through so after those three touches you know you could have been very very aggressive and said this is a micro swing high this is the current little value congestion zone and taking it there as well so you could have done that with a very tight stop so getting in about the 83 84 level and then going straight down to that that resting iceberg and on this scenario you might have been conservative and had that as your first scale that point or you may have been a slightly more aggressive and and so maybe at least a point or a couple of ticks below that because it will break it then it comes back retests this big trade or cumulative iceberg and then breaks down okay the danger at this point as it breaks down and the low as I said was down at yesterday's lowest at 15443 the danger of of this scenario is that you see this big move and you might be tempted to fade it too soon right and I've done that trap before I've certainly done that trap more than once you know in relative terms to the action that preceded it this was an enormous move down so you know even back here from 15485 down to about 15460 say at this point if you're thinking about fading it that's essentially a 25 point straight down vertical movement or as close to vertical as you're going to get in any market but you know one thing that I've learned with this beast the NQ is that you give it a chance that when it's moving when they're showing real intent and give it a chance to get to the most likely scenario of exploration and in this case it was the stops under yesterday's low so it was it was quite likely that we would get at least close to this 15443 area okay in terms of MBO stops and triggers I mean you've got one right here at the 4546 so if you were going to be early and try this as a higher time frame ABC supply demand trade effectively a type A that if the demand if type B the double bottom was down at 43 type A would be this trigger here hitting through resting liquidity now you've got some very big trades there hundred hundred so you've got about through to 300 in that zone and you've got a 63 MBO stop on the volume on the volume pressure imbalance you've got a nice red zone so that would have been a valid a category depending on how wide your stop was you know if it was a five or six point stop you'd have clearly been stopped out but we're you know if you've had a had a wider stop especially taking into account the fact that we there was a strong likelihood it would get to fight 15443 and look for the stops underneath it you might have had a wider stop there but definitely when we then have a second MBO sizable trigger of 34 MBO stops and we're right at this 15443 level so if we draw that back in so we're talking about right about here and we see the rejection there and we can go into the microstructure as well at this point let's get back to the cursor so you've got you've got them looking for stops in this area that they found 34 MBO stops they did how many they've probably got about a hundred in terms of volume underneath that yesterday low but then you begin to watch that microstructure straight afterwards I have to get rid of that because it's moved so they said they found their stops there could they then go any further no what kind of transaction did we have at this low and then what happened next what often happens you know when we've had what is essentially a climactic spring below yesterday's low is that they'll move away not be able to get back down and then they will congest or form a new zone which later turned out to be accumulation here and what you're trying to do in your profile terms is to see where where that accumulation is and to get in long at the south side of it I as far down in this zone here so if I drew it if I draw it again see I'm aware that we're coming up to some news at 8 30s I will have to stop in about a minute so you're essentially noticing the congestion zone there and you've got a swing low in terms of a micro swing low so that is a category C and then if we move across I mean this is hard to do in real time by the way it takes having to experience this and losing as well a few times to really really you know try and master this this whole process but effectively you are trying to get into a long around the edge of this new accumulation trading zone so you know you're either taking that as a category C or this as a category a type long and what are you going to be targeting you can be targeting the breakdown at that 93 level so in other words if you can get long here even though we've had this dire move down and it looks for all the money in the world that it just wants to keep going lower and lower there's a really really good target up at that 93 and if we look what happened I'm gonna have to go live now and we go off to ETS it went effectively straight up to that 93 I'm going to move on because we've got we have the 830 release coming up right about 30 seconds time make sure that we are live on this okay now scale that correctly so we're gonna just deviate from the schedule just to have a very quick watch of the US trade balance released by the way please feel free to fire in any comments you've got either in the discord channel or on YouTube but we're just going to watch what happens with the US trade balance release on the trading view calendar this is not a high importance once a medium importance but let's just see if we get any decent action and bearing in mind the liquidity is still mostly below okay we've just had 830 and the trade balance actual was 60 minus 65 billion against a forecast of minus 68 billion so a tiny beat a tiny beat of that level and I wouldn't say there was tremendous activity for tilty straight afterwards and if we zoom right into NQ no it's it's not like the M crazy non-farm payrolls type activity so as we've often said with these news releases the first move is often a fake move so if this had a little move up and then we gradually made our way down towards that liquidity the resting liquidity below that would not be that surprising it's having a look at this level here the 4488 level which has been there it's been there since the European session so it hasn't been there all night but it has been there for a good while anyway that's relatively slow which is good we'll come back to that live trade analysis in about in about 15 minutes okay next the the third quarter of our hour here we are we are beginning to move down the third quarter of our hour I want to talk about this being a breakfast session being preparation to assist you with what might be coming up in the RTH session that was one of the purposes of my setting up this webinar which was partly to help people to see the type of action that had been taking place in ETH and to see what was resting by way of liquidity in the market and also relate that to yesterday's action yesterday's profile so yeah let's start talking context okay let me just drag into this my little trading view indicator that I've told people about before okay so this is just a very quick overview of where we have been in in ETH so VIX would have started about 4 30 a.m. so that is relevant even though the main VIX doesn't open till RTH okay it's a mixed bag the German markets and Bitcoin have both been down they both got a fairly good correlation with NQ especially Asia Japan was up China was down the dollars even though it is fractionally down it's still up over the last few days and that's at a strong 104.72 that's a DXY I'm just using for this table just because it's an easy symbol to get hold of in trading view and looking across the currencies the weakest one appears to be the British pound which often has direct correlation with the NQ in the European session and the ES NQ YM and RTY you can see the the confluence of the correlation between the first three they're all down roughly 0.25 to 0.3 percent RTY not down as badly so just just putting that into context in the in the overnight session we're down a little bit okay let us have a look at let's have a look at the dailies etc I'm actually dragging bet on rather than screenshots here I'm doing my live chart so I can zoom in and out for you so you on the ES daily we've got this up trend all these two up trends that I've been talking about for the last couple of weeks they are still intact even though we now looks like we are coming back down towards the most recent uptrend line that is for ES this is just to show you that I do have a 15 minute as well I find the 15 minute really quite good to contrast with yesterday's range but I am a strong believer in multiple timeframe analysis but I probably don't use it in quite the way that some people do NQ which has been stronger than ES and you can see that it's still even though it's come down a bit it's not looking as weak on the daily as the ES and the 15 minute yes it's coming down a bit and we are let me just have a look where we are now come on off the screen okay that's one way of getting rivet okay let's have a look at where NQ is yeah so we saw a little way off yesterday's low but we've had a good move after that fake little up move on the trade balance release we are now in a little trend down exploring downwards on the microstructure okay let's have a look at some TPO kind of action and work out where we are in relation to value okay on the ES had quite a nice skinny profile here setting that high that's taken us on to this on to this down move over the last couple of days just for everybody's memory the white shaded profiles at RTH and the grey shaded profile is ETH and I'm not showing every ETH one because that I find because the ES market is not really open during ETH I the underlying market the stocks are not open one can tend to ignore the the previous ETH sessions other than today when you start working out what you want to look at for the upcoming RTH session but if we just zoom along here and ETH we've got a nice profile of some value that has essentially delineated from 4495 and yeah it looks like you know if we are going down towards that resting liquidity we're exploring lower and if we zoom back in what is below we've got a couple of singles on the profile side that may get tagged we've got some the bars here are all liquidity i.e. the order book so you can see the the heavy resting liquidity around about the 4481 and 4485 levels so yeah it looks like they they may be able to get down there perhaps I'll be able to even be able to do it before before the RTH open and then quickly come across so basically just a recap on ES that we've got a a delineation point or resistance point there at 449550 as to where the current value in ETH ends in the upward fashion so if we get back above there then we may explore the value up towards settlement in other words there is a good chance if we can break 449550 properly that we'll get up to settlement which is up at 4502 but being under that psychological level of 4500 is interesting too okay on NQ let's just reset that one okay and zoom out you've got a lovely distribution overnight there's no breakpoint in the in the value in the same way the ES had but there is a ledge up at the 15498 15500 region so if they get above that then there's good chance that they can tag the settlement which was up at 15535 and remember we've got that confluence also with yesterday's volume point of control so you've got those on the upside and below them we've got some heavy resting liquidity which is obviously been there a few days down at 15343 you've also got a naked you've got two things here you've got a 50 day moving average that's the 50 day moving average and you've got a naked volume point of control and they're both around the 15371 that's if we had a good down day a good in that sense of good in the sense of having a good range that there are things underneath 15400 for it to tag and even some liquidity around about the 15345 marker okay where are we on six minutes again feel free to ask any questions or if I also wouldn't mind any feedback on the revised structure of of how I am presenting the the one hour that I've got so if you prefer this new format yeah please tell me if you hate the new format and you prefer me doing more education and going through ETH setups in in minute detail please let me know as well okay right let's get back on to ES whilst I am more than happy to trade more in fact 18 90 percent of my setups on NQ in ETH RTH is a different matter entirely it is a scary beast you've got to have pretty wide stops in my personal opinion again it's your trading plan your trading setups you've got to decide what kind of stops you want should you trade NQ in RTH but I found that they can they can just whip it whip saw it in both directions and take out as many stops they possibly can before they get onto where they were going to in the first place so I find it if you're risk averse in any way you're not going to like NQ particularly in RTH okay so let us have a look so we've got about 20 minutes to start drilling down into what we can see in ES looking forward and we've got that profile as well okay so we've got some resting liquidity which is relatively obvious at the 4485 and if we then get through this zone here we haven't really got any value if we break through this area then there's a potential of you know having a decent run till we start forming some good value so we have sort of interacted with this resting liquidity at 4488 and we've got the next ones down at 4485 50 and 4485 nothing tends to go in a straight line so we are not expecting it to go straight from here straight down to 4485 but I would not be surprised if that is not tagged whether it's before 930 or relatively soon after 930 so let's look at what is on our screen so one of the things that we we have is the outside liquidity market by the way oh we've now got a little mini signal appearing on the volume pressure imbalance just showing strong delta buying on this little leg up since they put in that buy iceberg so if we zoom right in we can see quite clearly yeah it's strong buy delta on this move up I'm just looking across at my time chart to see what it is if we get into the analysis of the microstructure I think there is a zone above up from about 90 75 to about 93 25 that is a value or congestion area so if we can get into that then then there's a good chance that we'll be in where's the pen gone yeah there's a good chance that we'll get back into this previous area so if I scroll out and see if that stays there yeah you can probably see it a little better than I've drawn it so it's really around about here down to there so it's a question of they're going back up to tag the bottom of that congestion area which is about 1975 and then if they get into it can they can they explore to the other side of that little mini value or congestion area that little iceberg that was there has disappeared it would be nice to have a little signal there that they were intent on buying you know if they were clearly supportive you know if we had a bias perk around about here that stayed in place and that they added to it to help us drive to the other side of that little congestion area where that we've also got something else on the counter so if we quickly since we are since we are doing a preparation for for the rth session as well as this live commentary yeah just be aware that we have the red book year on year coming in at 855 a.m eastern and then you've got two pieces of news including the most significant news release at 10 so at 945 you've got the s and p global composite PMI and at 10 you've got the main piece of news being the ISM so expect significant volatility in that 945 through 10 to 1030 zone the only danger with live commentary becoming a little bit dull in this session is if there is not a lot of market movement in ES whilst we're talking about it so yeah just to recap we've explored down to this resting liquidity here we've had a little mini spring just one tick lower and now we're exploring back up to where the the next little congestion area is which is at 9075 to 93 so it's a question of can we get back into that and then traverse to the other side since it's a little bit slow we can have a look at NQ as well and see whether that is moving quickly what's happening so at around the same time that ES collided with that resting liquidity we had a lovely bounce on NQ so with NQ you often get a retest that's why I'm saying that the A and B categories can be you know just as useful as the spring type C categories by demand and since then we have been grinding back up a bit with this liquidity that they place in NQ I don't hold too much weight on it it's essentially just the market makers identifying the current bounds but since this will move every few minutes as price moves there isn't too much weight that I feel that I can attach to it so you can see here it's the same bounds I mean the distance between them is four four eight five down to yeah about 15 points and so it's just like a 15 point boundary that the market makes and you can see them they've just moved it up again so it's not the same evidential weight or market generates information as a resting large piece of liquidity that might have been there five six ten hours so on the microstructure in NQ if we zoom in vertically using Tom's words let's mimic Tom a little bit here once they reach this high they explored down they couldn't exploring lower so price was too cheap and now they are exploring higher and if we go back to ESC if we're back into that zone yet we're into the into the base of this congestion zone here but we haven't properly got into it yet so we haven't really got above 91 which would suggest that they might go to the 93s so the moment we we are rejecting the entry into that previous liquidity area even though NQ was quite strong going up there on NQ again I mean the exploration of this volume pressure imbalance it's interesting I mean I in my journal when I'm going back on this I will look back to see how useful this indication was like the green signal there you mean you can see that coincided perfectly with a good fade if you had used it partly because it was in a good area good setup whatever it was and you'd taken it as a trigger that would have got you I don't know I don't you say it's the range is too small to trade at this time of the day that that's maybe you could have got six points but that is a lot of risk so whether you'd even have got one hour is questionable even though we know that the the main racing liquidity is below so we're still trying to get back into that congestion zone above but we're currently exploring in this little area they've rejected this price so they're now going they've said it's too cheap there so they're now on the microstructure moving higher and we're getting back into that 91 to 93 zone so once they do that let us see if we can then go to the other side it's interesting that they haven't got into it yet so they've tagged the bottom of that congestion zone a couple of times they've got the liquidity which is very appealing below at this time I suppose I would still be looking at NQ for any quick shorts the NQ is stronger and leading ES it seems clear when you contrast the two types of action there which one is leading I'm just looking across and seeing some weakness current weakness in the US dollar and since there at the moment is an inverse correlation between the indices and that US dollar that's been helping the NQ on that push up so we had another little volume pressure imbalance signal but in terms of where we are I like to look one of the reasons I have my short-term candlestick chart as well is I like to look at areas of rejection and I find those particularly useful for when I'm looking for my ABC setups in conjunction with the X-ray vision that you get from bookmap to see what's inside those so you know you've got this swing high here it has gone up but I wouldn't really call this much for rejection yet and we also know that settlement is well above where we are settlement in NQ is at 5 3 4 50 15 5 3 4 50 which is quite a lot higher there so there is a decent possibility that the market will try and rally towards settlement or try and tag settlement at some stage before any directional move which might take place after the economic release at 10 a.m so when we're looking at this as well if we had a really really thick band of liquidity in ES and we were setting up in time in time terms of coming up to some major economic release you know for example if this band was going from 4 4 85 down to 4 4 80 so like five points of heavy heavy heavy liquidity which it is not then you you might form one theory hypothesis whatever you want to call it that it will not get through and that they are just absorbing the sellers for a good strong move up after the economic release here you've got some separation between the band so even though you've got the liquidity clearly below you've got some separation so it's not as clear in that scenario so you know quite often they can hear you know they've taken out one liquidity they bounce they might come back and take out the next one they bounce then they come out and take the third one rather than they hit a huge brick wall take as many cells as they can and then zoom upwards so it's a different scenario and that's you know when you're looking in eth coming up to the open that's why the the way that this liquidity is spread out can be useful to help you form views on what might happen you know so what you know what I'm trying to say that this stage is that you know quite a lot of me still thinks that they will get down to this level at some point but whether they decide to go up and take settlement first is another question so yeah we got into that into that little congestion zones we've got above this 91-25 and we said that it was quite likely that we'd get up to the other side of it then which is up at the 93 level so you know if you were going to go micro scalping you know once it looked like we were hammering on the door of that congestion zone value zone from 91 to 93 then you could have taken some of these little springs you know where it comes down and reverses straight up so if you had done that and we have hit that 93 now in fact we're going up to 93-25 if you were going to do that at this time of the day I personally would take very tight stops because the range is not huge your target's not huge I mean if your target had been 93 or 93-25 I think 93-25 was probably the most likely going looking back through it you want at least two points so you really you know you would not be taking more than a point's worth of risk that you shouldn't be or I'm not saying shouldn't I'm saying one approach would be that you do not want to take more than the point's worth of risk if you're only looking for two points worth of target because I mean even if you've taken where's this the last one here you've got if we just make this vertically zoomed in so it's easy to see so say this is a little spring and it just pops down there so and you get in at 91 or 91-25 and you're targeting 93-25 you do not want I mean you know if you can get away with three ticks but no more than four ticks to get that the other side of that little range that is you know that is what you might do if there was nothing better on offer in the last few hours and that met your trading plan that is something that you might want to do but again we're not talking about a huge trade just having a look at where we are so I'm also going to just check my room to see if there's any questions there no no questions there yeah so you had another repeat of this tiny little iceberg we had one about 10-15 minutes ago yeah it just seems like they're playing some games here in this back in this congestion zone one of the things that ES might do as well is to ride all the way back to yesterday's low so we're out of range going into the market open and this period I mean the 9-930 that's coming up is a time that they often close a gap so so that there is no gap when the RTH open happens it's something that I've noticed over the years that I've been watching it so the idea of a filled the gap can take place just before the market opens as well as during the market so the gap where is yesterday's low yeah it's the psychological 4500 is what I have as yesterday's glowbecks low again it depends exactly on what session times you use I'm essentially using 1800 new york time to 1600 so I'm kind of ignoring some of the action that takes place in that dead time between settlement close of the market and the two hours until the Asian open happens so that some of my levels may be different to some of the levels that you use or are quoted elsewhere so we've got a little bit of ping-pong going on here between these this sell iceberg and the buy iceberg I would not be trading this I will have a quick look down see if there's any changes to that resting liquidity and to actually note what the level is it's not huge 235 and the one below that at 458 4481 is 290 and then you've got one at 266 266 290 and 235 so those are the levels that they flagged so again um you know um you know the ideas in my head are the at the moment we've we've tracked back to VWAP or glowbecks VWAP and there's a possibility that they will track back up to yesterday's glowbecks low at 4500 and also yesterday's daily low which is up above um at 4501 50 and settlement 4502 50 so that that might be very interesting to them um but then we also have the resting liquidity below but should there be any significant um news or deviation in news on those releases at 10 a.m. and 9 55 you know some of this resting liquidity might just get thrown away completely it might just suddenly disappear because there's a totally different game of thought based on the content of those economic releases so you just have to be aware of that one too okay we're coming up to um yeah Darius you're right it's a bit of a yawn market isn't it weren't that many interesting games it's just that tiny two-point range that we could have traded in ES for a long but there wasn't really a lot to do anyway I think I'm coming right up so I've got 30 seconds left so the moment it looks like they're exploring upwards so um and you've got some resting liquidity up at 4496 which would be maybe their very first target and then you've got the areas up above and then I just mentioned the glowbecks low the daily low and settlement just up there so it'll be interesting to see if we grind our way up there for the next half hour anyway thank you for your company and I will end the stream