Entering on down candles

WHEN GOING LONG, I think from a stop loss position perspective entering on a down candle is better providing that the entry is in the right area of the chart.

It means a stop loss based based on the chart eg swing low, can be kept closer.
This means better reward to risk and room to increase position size.

Any thoughts.

 

From a stop loss perspective yes, BUT it also means you are entering against immediate momentum. I do both.

 

This was discussed briefly in another thread recently with volpri. He is also essentially "fading momentum" on a micro timeframe, albeit with some context for the areas (support/resistance levels).

Realistically though, there will be a "down candle" on one timeframe while it might still be an up candle on another timeframe. If you are fading the momentum of a 1,3,5 minute chart while the 15,30,60 minute chart has given you the go ahead to be long (short), then I view that as a better way of doing things...

All of this is pretty vague though. The things that will work in one particular market could get you killed in another. Some markets have so much trend strength (one-way price action), while others will just whip around in a range...

 

yes if its a range and at support or below, notice i didnt say uptrends, hard to tell how deep a retrace can be in uptrends

 

In my strategy i enter at a key rising moving average (so momentum in the background) with my stop below the most recent swing low. So from that perspective i see no logic in entering on a up candle.

 

Sure as 'ell beats entering on an 18-tick greenie.....

"Well! Ain't you a talllll drink o' water!"

 

Really pointless to answer this as don't know timeframe, don't know of anything what you trying to do as far as method, where are you in the swing, like in Elliott-how far along is the current trend. All this has to be back tested, also it can be wrong place to be entering based on Fib retracement or is signal short of support or too far past support where it might be considered new trend.

 

So why not give the guy an example with the ES right at this juncture.

 

I would have thought it was a given that we are at a swing point seeing I wrote this in the first post

"providing that the entry is in the right area of the chart."

In other words. Lets say price has swung to an area where you would like to enter, do you prefer to buy on an up candle or down candle.

 

Down candle because confirmation is a fallacy.