Making of a method

Discussion in 'Journals' started by game, Apr 15, 2013.

  1. dbphoenix

    dbphoenix

    You posted a 1m chart but you're referring to a 5s chart.
     
    #641     Sep 9, 2013
  2. game

    game

    #642     Sep 9, 2013
  3. dbphoenix

    dbphoenix

    Key phrase here being "based on the prep". On that basis, yes, a long was called for. You do see, though, that there were two rets prior to your entry.

    I don't know what you're referring to by "mp zone".

    You appear to be going long on this rally rather than exiting. Or are you referring to the 5s chart? If so, it would be helpful if you were to note your trades there.

    I'm going to stop here because it seems we're at cross purposes. I can't match your post to your charts. So I'll stick to the question asked regarding positioning yourself in re 48-54, and the answer is you don't "position yourself"; you go long at S and you short at R. If you need any sort of confirmation, then this won't work, particularly if the range is less than a certain width. Instead you have to wait for price to exit the range and trade it as usual.

    An exception to this occurs when an imminent move is expected, such as as "the open". Here you could buy support in the pre-open range and just hold on to it. If price then breaks out, you're already in. If it doesn't, just exit as usual and either stand aside or go short.
     
    #643     Sep 9, 2013
  4. game

    game

    Sorry about that. Here is an updated chart.

    http://www.sierrachart.com/image.php?l=1378753401635.png
     
    #644     Sep 9, 2013
  5. dbphoenix

    dbphoenix

    OK, I'm with you for most of the ride. Did I answer your question?
     
    #645     Sep 9, 2013
  6. game

    game


    I recall you saying that entries back into Range have very low price risk but very high information risk.

    So I assume that the only good reason for trading back into a range would be if the information component is being derived from larger context factors, i.e. a trader bets that the range will hold because of x,y,z...Ex: If a breach outside range R is brought back into range with force, the trader justifies an immediate Reversal short. The only information provided here was the immediate rejection of the breach back into the value zone and the fact that the breach was above a range (which automatically implies that this price area has attracted sellers in the past).

    Edit: I guess a breach that was rejected would not be a 'context' factor, but rather information dervied from the immediate PA. But my question about gleaning information from context to determine if the Range will hold still stands.

    Edit 0249 CST: I think you already answered this question when talking about the exception via imminent moves. Got it. Thanks.
     
    #646     Sep 9, 2013
  7. dbphoenix

    dbphoenix

    There's no certainty here. And really the only reason for trading within a range is if you just can't stop. When I find myself in a range, I lift my fingers from the keys and contemplate the mysteries of life. Wyckoff took entries in the range if he saw that it was about to resolve itself, as in the example I gave regarding the NY open. But that was Wyckoff. I'm not Wyckoff.

    Another problem with trading ranges is that once they become obvious and therefore tradeable they evaporate, and one is left holding the bag. And how many points are they worth anyway?
     
    #647     Sep 9, 2013
  8. slugar

    slugar

    What does mp mean?
     
    #648     Sep 9, 2013
  9. game

    game

    Mid Point - 50% retrace level
     
    #649     Sep 9, 2013
  10. niko

    niko

    Thanks.
     
    #650     Sep 9, 2013