my summary or my understanding of Brooks price action

Discussion in 'Educational Resources' started by padutrader, Aug 18, 2019.

  1. padutrader

    padutrader

    • since H2 L2 are setups to enter a trend, when the pull back is finished.....trading these near or at a moving average, is a higher probability trade.

      trading reversals [mtr] when the market is away from the ma, increases the probability of the trade.....and if the reversal trade is during a time when market is in trading range [when the ma is flat or weakly up] then that also increases the probability.

      fading breakouts from a trading range formed around the moving average[enter on a setup] is also a high probability trade since it means that the moving average will be flat.
    • This is why Brooks says most breakouts fail:since market is in a range most of the time, breakouts during that time may be faded
    • but Brooks also says you need a set up.The context is a trading range market but the entry is on a set up.
      So first determine the context and then wait for a set up.....trading only on context equals emotional trading.do not enter randomly.
      • DO NOT trade H2 L2 on a trading range day......

    • on a trading range day fading breakouts from trading ranges formed near or around the ma are high probability trades.
     
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  2. speedo

    speedo

    I've known Al for a long time and I respect his work but there are trends in consolidations and consolidations in trends. Everything is relative and you have to define your relational context to make sense of trades and trade management.
     
  3. padutrader

    padutrader

    what is the difference between a pull back and a trading range?

    I think that a pull back should be [or is] much shorter in duration than range.

    but understand that this is very time frame specific:a range of 24 bars on a five minute is only 2 bars on a hourly and that may qualify to be a pull back [in the hourly].

    may be that why Brooks says that breakouts from trading ranges will fail.....brooks mostly trades in 5 min....
     
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  4. padutrader

    padutrader

    this thread is my attempt to define a relational context to certain market conditions and an attempt to define pre defined conditions to enter certain types of trades.

    This thread should not be seen in isolation but together with my journal:
    https://www.elitetrader.com/et/threads/trading-brooks-h2-and-l2.334991/page-3

    where i will be posting trades and mentioning what reasons or context that particular trade was made.

    the thread title makes it clear it is MY summary.

    i hope it may help some traders figure out what Brooks is all about:this will not help you since you are more than familiar with Brooks.

    i hope that it helps me too since Brooks is 'all over the place' with his teaching and i am trying to organise it into a form that makes some sense to me.

    i am posting in the hope it may helps some others too.
     
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  5. padutrader

    padutrader

    as you probably know i have been trying to make sense of his method for over 12 years .

    this thread is my attempt towards that goal.......
     
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  6. padutrader

    padutrader

    that is exactly what i am trying to do here in this thread:the thread title makes it clear it is MY summary.

    that said i am posting it here because it may help other traders understand Brooks better.

    i spent 12 years before this so it may help others save a bit of time.
     
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  7. padutrader

    padutrader

    i am posting a lot on Brooks because, IMO, he is the only teacher who talks about trading in a realistic way and about markets in a totally new way.
    and i read my first book in 1994 so i have seen many
     
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  8. REDP1800

    REDP1800

    kiss
     
  9. expiated

    expiated

    Even Brooks himself makes the following comment in his book on trading price action trends...

    ScreenHunter_6273 Aug. 18 07.43.jpg
     
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  10. sisyphus.gif
     
    #10     Aug 18, 2019
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