Then again neither are 38.2% or 61.8%. 1, 1, 2, 3, 5, 8, 13, 21, 34, 55, 89 ... But all three are ratios.
Thank you so much Volpri for this detailed response. I will read and respond after I leave work. Thank you sir.
I won’t be posting any of todays trades if I do any trading. However, I want to visit again Mondays trades to show what I call the “compounding effect”. It is one of the prime reasons I jump in and out, over and over again, even on an established trend in one direction. It is one of the reasons I cut profits short. It is one of the reasons I average down. If I can make more money by jumping in and out, locking in profits, than by sitting tight in an established trend then commissions are a small price to pay. This compounding effect is something I learned years ago from a trader called J.M. Hurst. I don’t think he called it that but he explained it in ways I could grasp it.
A word to say about 5 minute charts, 15 minute charts, 30 minute charts...etc. I often mention seeing the footprints institutions are leaving “in the sand“ so to speak as they trade. I mentioned they cannot hide what they do, or better said, they cannot hide their effect on the markets, as sooner or later, it will all show up on the chart. We can see all that we need, as small traders, to extract profits from price movement. They do see info we don’t see and don’t have the means to see. And they can hide orders, at least that is what I hear from the grapevine..LOL However, if anything be hid from us mere mortals their gargantuan “big foot” footprints cannot be hid and they WILL show up in the snow. The abominable snowmen of folklore, in the trading world, can be spotted as they go about the daily activities running in the forest of what is called the markets. Us little crickets best watch out for the Yeti and know where and when they are running. Now stop and think about it. It is ludicrous and even hilarious to picture institutions having rooms full of traders all hunkered down glaring at computer screens with 5 minute charts..or 15 minute...charts etc creating bull and bear bars...dojis etc. MOST ARE NOT DOING THIS. I just want to ROFL when I picture this in my mind. In my ramblings I talk of individual bars, bull and bear pressures, contexts in the markets, and other such things, and usually do so within the context of 5 min charts. These are descriptive terms to explain price action. Bulls and bears....pauses..profit taking...exhaustion moves...measured moves...and the myriad of chart patterns such as wedges...triangles...flags ...retracements...etc. Look, institutions such as funds, are just buying and selling. Filling orders from investors etc. Hft’s are doing their thing. Banks are doing their thing. All this buying and selling creates pressures, patterns, bull and bear bars. Their activities draw the charts out. In that sense they cannot hide what they do. Have you ever spotted a bear algo working the markets? The effects that institutions have on price movement show up in all TIME FRAMES. Monthly..weekly..daily..intraday...I just use 5 minute charts because it gives me enough good scalping opportunities (10 to 30) AND it is usually sufficient time to structure a trade around “what” is happening in the markets at the moment. A trader can use 15 or 30 minute charts as well if that suits him. So, when I say “the bears are winning on the last 3 bars on the 5 minute chart” it is only descriptive of “how” the pressures of institutions, with all their buying and selling, are showing up on that 5 min chart. The same can be said for any TF, even monthly. Charts are a graphical representation of the active pressures in the markets. These pressures, for the most part, are created by institutions. The analyzing of these pressure can be across various TF’s. The 5 min chart just suits my style of scalping. But don’t think for a second institutions are hunkered down staring at 5 min charts and drawing lines and patterns on those charts. That is comical. They are just buying and selling, for whatever reason. But all their buying and selling draws the charts in whatever TF. It is we crickets who are analyzing the Yeti’s footprints and measuring the size and distance of their stride and the indentations of their weight in the snow, as we try to determine the direction they are traveling and the speed of their movement.
Thank you so much for this. This is a very good comment you wrote regarding PB in relations to strength and risk and proability, but most importantly context. Thank you soooooo much.
Thank you for this. This keeps me confident and keep on pushing on. It is fun indeed. These are all valid questions to ask through out the day. I understand