I find great difficulty with maintaining a single resolution level in trading. Take the following example: The first move of the day is a single, very long and tall tape moving upward. A tape in the opposite direction follows, also long and tall in nature. The result is a wide pt. 3 channel with positive slope (uptrending). The third traverse, as we expect, is a dominant upward traverse, but it is not a tape. It is a combination of +tape, followed by a hook (-tape), followed by another +tape. Or it could be a +tape, followed by a stall, followed by another +tape. In any case, this third "traverse" is itself a pt. 3 channel, nested inside our larger channel already created. Today's trading already provides several examples of this type of occurrence (see attached). Let's say we only want to trade the forest level, SCT style. From the get-go, we trade the first traverse up, the second traverse down. But on the third traverse, to maintain the same resolution of trading, we'd have hold through the hook/stall embedded in the progression of the traverse. Sometimes it's very difficult to keep track because if we create pt.3 channels exclusively from tapes, channels form nested in channels, which form even more nested channels. I guess it's just practice that's needed to keep the resolutions organized and separated. RT
This is just how I see it when I tape or do channels. I make it tight to see the change in price and volume, as early as possible.
Yep, that's what I do too. It's calculus 101. Place the tape around the bars that give the steepest slope (highest derivative value) to catch stalls or opposing tapes sooner. RT
The fractal I want to trade on is the one on which dominant traverses increase in volume, and retraces decrease in volume. I believe that this is the best fractal for a given chart resolution. Sometimes this trading fractal fits perfectly with the 5 min chart, sometimes it doesn't and steeper or longer retraces look like new channels on my trading fractal. When this happens I usually ... overtrade.
that's why the 2m YM comes in so handy. put the 20ma on both the 5m ES and 2m YM, and observe their interaction...