It takes a nosedive. This is what you want to see if you're going to enter at the top of a range heading back into the range. And if you miss it, where does price hesitate next?
I think db has made the focus of the current 'assignment' the support and demand lines, and retraces. At least, I think I need to get that foundation in first.
I drew my channel on your chart. The Green was a long, and the next red was the cover. The 2nd and 3rd red lines were both short entries. As you can see, you got your long at a lower price than I did, and you shorted higher. Good work! I hope you didn't misunderstand what I was trying to say. The framework you created to analyze this morning's action gave you better trades than mine gave me. If your style and your plan is working for you, I was just [humbly] advising you not to be fearful that you're still doing it "wrong". Or being uncertain because other people are seeing different entries than you. I notice you tend to get in quick and early, and don't seem to have a natural aversion to trading tight ranges and tiny channels. If you don't like the uncertainty, you can always hold off on your entries a little more, but if it isn't broke, don't fix it! Plenty of ways to skin a cat, right?
Well, I thought you were talking about what happened just after it hit 71 for the first time (10:30), given my previously fearful history, I would have exited the short at the break of the line around 10:30, I am trying not to be so strict during this exercise. After the small congestion that ended at 9:39 price finally took the nosedive you are referring to. If one is not short already I don't think one has a RET to enter until 9:41 at the bottom of the range where there is another small hesitation.
Thank you, I understand your chart better now. Had I traced a channel I would have not taken the short, but I am not doing that now, I am just following lines and RETs and trying to identify entries, as can be seen I am not even defining exits here. The opposite entries would entail the closing of the previous position, but I am not into that just yet (simulating 2 accounts perhaps), I am observing price as it moves after my defined entries and trying to come up with new hypothesis I can prove with more testing in order to define exits. So far I learned that taking these entries into the chop is not a good idea, but that is something that I am also documenting, in order to clarify the places where I should actually trade and the places where I just should stay aside. I have identified that my understanding of the chop is not as good as I would like, so I am working on that as well.
Oh, I was tracking Supply and Demand the entire time, I just didn't start drawing the lines on the chart I posted until price began to move outside of the Trading Range/Congestion I perceived. I have no parameters for entry in such small ranges, although some might. The blue and yellow lines are the demand and supply lines that my entries were based off; although you are correct in one sense, in that I did use the break of my initial right channel line as an additional indication of selling pressure for the shorts at the end of the chart. Hope that clarifies things. --- @niko Thanks for the response. I look forward to continuing to learn this stuff along with you. Your comments and participation in the thread are a big help!
I have read your stuff on other posts with enjoyment. You have a knack for getting to the essence- describing it back on a deep level with few words, That is a rare and admirable gift! Thanks RN