Thank You!! February 14th Prep - Context Plan the trades. Trades Red dot: Short Green dot: Long Black dot: Exit
This day I felt comfortable especially because during the prep, the ranges were easily definable, therefore the zones where to look for trades were clear to me. In this order of ideas I wanted to highlight the importance of the prep because it gives an idea about where one is located in the market February 18th Prep - Context Plan the trades. Trades Red dot: Short Green dot: Long Black dot: Exit
Regardless of whether you are using 97 and 32 or 00 and 27, you're still inside a range. Therefore, all that is available to you until price breaks out of either range is reversals. With that in mind, are you going to place a bracket order around 24, or are you going to wait and see which direction price goes?
I would prefer to see the PA around the limits of the Range, and follow what I posted in the previous chart (gears journal). But regarding to this one, and taking in consideration that the price is within the TR, I would not take the Short RET because after entering the price is at the MP. About the reversals, for the moment I wouldn't trade them, because for now Im testing only one strategy RET Note: But I'll see carefully the Price Action of Monday. Thanks for your time
The MP is not necessarily important or even relevant since it is nothing more than an indication of strength or weakness. If you're trading a range, strength and weakness are extraneous. But as for deciding not to take a RET, short or otherwise, this is wise. As for the "limits of the Range", bear with me. There are a multitude of limits that you could plot here and the more limits, the more ranges. Exponentially more. You don't need this hassle at the open, not when you're trying to judge what it is that traders want. Therefore, look at what makes the most sense. First, note that 27+ is tested twice on Friday. This is the level beyond which buyers will not go. It is not until the end of the day that buyers for whatever reason are willing to pay the ask. Friday Fever. Who knows? But what is most important is not that buyers are willing to pay more than 27+ but that their fever is so short-lived. That and the fact that there aren't enough of them so that sellers can move price higher. So price falls all the way back to 20. This confirms the strength of 27+ and discourages raising the level of the range to 32+, much less 33+. And when you have to make a quick decision as to whether to enter a reversal or not, 6pts is a lot of wiggle room. Therefore, when assessing the probabilities, I suggest that 27+ is the upper limit. That reduces the number of potential upper limits from 3 to 1. As for the lower, note that price dips below your line by barely a point. However, it dips below 00 considerably more than that. And spends 10+ minutes down there. But sellers aren't willing to lower the ask. Next test? It hits 00 exactly. But there are two elements to this: one, that it reversed at 00 and two, that it did not dip below 00 a second time. Each of these elements provides a slightly different message. And the test after that? Price dips below 00 again, but not nearly as far and for not nearly as long. Therefore, what is erecting the barrier? What is the price that everybody has his eye on? Again, this reduces the number of lower limits from 3 to 1. So now, instead of 3 upper limits and 3 lower limits and the many combinations that can be provided with so many, you have 1 and 1, and they can be combined only one way. But since you don't want to trade reversals, at least not yet, you're faced with the prospect of doing nothing unless and until price at the very least breaks through 27+ or 00. But that doesn't mean that you can go make breakfast. This is an opportunity to practice transforming inaction into a tool. Use this time to observe. What are traders doing? What is the pace? What is the activity level? Are there a lot of gaps in the tick (is price shooting up and down instantly)? And how are they treating the equilibrium level (24) during all this? Given all of that, what do you plan to do if and when price breaks through 27+? Are you going to take it? Or are you going to wait to see what happens at 32? Or are you going to wait and see what happens at 33+ (which is by now more than 6pts past 27+)? Same questions for the lower limit(s).
So price just broke through 27 and is retracing. Did you decide what you were going to do? Incidentally, if you want to know what the LOLR is, talk to damnpenguins.
Following the trading plan and if the UL of the TR is at 27; therefore the long should have been taken when the RET was triggered, however the price didn't do what was expected, which was confirmed the RET, hence the trade should have been discarded, with a little loss or in BE. Moreover, and if is defined in the trading plan an entry in the opposite direction (short) could be taken because the price is at a R and the price is showing its unwillingness to move higher. ----- At this moment the price is around the previous high, therefore my question is Would you move higher your R level or you maintain the 27 R?
Unfortunately, it's all hindsight by now, so it would be best to prepare for some other trade at some point in the future.
Note: Now the price has gone above the previous High, therefore I should wait for the RET in order to go Long RET triggered