It's a RBO!!!!! Like hell it is Had all the classic indications of being a RBO - right up until it failed Will talk about what we knew - heading into today (know??? this is trading - how can we know anything ) RN
Before I talk about what was knowable heading into today..., allow me to discuss how I got there I use 4 charts 1 min - microscope 5 min - trading 15 min - longer view 240 min (4hr) - my overall view - iow the universe I trade in As a refresher - PA is contiguous..., not continuous - there are session breaks...., but it is all the same PA - no matter the chunks of time we choose to break it up in The (my) universe; What ever the universe is (ranging or trending) - so to must the predominant PA within it be It the predominant PA within..., that creates / makes up the entirety of said universe This true unless the universe in the process of evolving from one state to the next ================= What was know about the universe heading into today Price is in a range The context (rectangle) is in sync with that range The context, since it is in sync, can be leaned on Has anything changed to place the universe in upheaval - no Side note; that big ass up bar on the 14th came right after verizon announced aol's buy out So given what was known - any reason - until proven wrong - to think the universe has changed / will change - no ============= The potential RBO up..., I posted earlier today - which ultimately failed - occurred near the top of the universe's upper range (.28 cents short of it to be exact) Anything up to that point change to cause price to BO of its current universe - not that was indicated in the PA - even though the PA leading up to that potential BO was picture perfect - in every way - within the 1M range Problem was - that 1M PA was not in sync with the universe it was residing in It why MTFA is so vital in this business =============== Fast forward to now So..., price (the universe) has been in a range...., and is still in that range Any reason to think tomorrow will be different Not unless universal upheaval occurs ============================ On a different note; Now..., lets say the universe trending Would RBOs - in the direction of the universe's trend - be more likely to work Yes - but..., still must always be cognizant of where in the session / trend this particular range..., price is attempting to BO from..., has formed Reversals are a fact of life - as are extended PBs ===================== One other aspect I need to touch on.., but not sure how deep I am willing to go with it Intraday - price's bias Quicker this identified - it the profitable way to trade It can / does change throughout a session Just because price headed in a direction - does not necessarily mean that is price's bias - traps do get set..., then tripped ================= I still maintain ranges / volatility masks piss poor trading skills - and makes a real trader work exponentially harder RN
One other thought In a range universe; Targets need shortened up Stops need strictly honored.., and imo tighten (trade is going to work or not) When near the edges..., don't count on a continuation - until / unless something changes When price is in the middle of a range - that is no man's land - or rather suicide RN
BTW: One thing that comes to mind is that we're all of course trading breakouts in a way when it comes down to it. Everyone wants strong favorable moves away from their entry and closer to their PT (if any). What I interpreted from the original poster's idea of breakout trading was specifically buy and sell stop type trading where one gets triggered on the final strong move that breaks out. That's what I think is a fools game more often than not.
my 2c. flat price directional trades - I never trade breakouts. on occasions I like to take the other side of the breakout and hold when the fail is confirmed. spread positions - I like to take trades as price moves out of a consolidation, when my expected move is in its infancy. these trades tend to last days to weeks.