dammitttt, I hate exiting this one early. I tell you what, trading intraday, have to be able to hold on to those winners. You just never know and that is what I am trying to tell They and Mark about looking at the background stuff. Here is chart right there to trade, why go look at all that other stuff for. Just think what independent day trader has all that time for all that. You have to get long or short during the day.
Ok, so lets talk now. To the left is all that stuff right and here I am for TODAY. I have to trade and make money today. So what do I care about what happen yesterday and the week before and the month before? I have to enter a trade long or short today right? I have to enter a stop loss right TODAY. So all I have is what is in front of me. here is today's chart. I am day trader, I have to trade today. Who cares about the forest yesterday? I am not holding these trades for days and weeks. I am in and out in one day.
Using your chart let me show you something you may be missing. A symmetrical triangle we know is just a channel with converging lines. The bears and bulls are about equal in the pressures they are exerting. That is why the pattern forms. However, the pressure is also BUILDING on both sides. Price will not stay in this pattern. There WILL be a BO. It is 50/50 in either direction. UNLESS you look at the context within which the triangle has formed and the triangles location within the larger context. Usually the BO will be in the direction of the larger context. But, we must also remember any BO will be followed by an attempt by the other side to make the BO fail. And often, the BO WILL fail and the triangle just becomes the final flag in a bear trend (in this case) jbefore a reversal takes place. Ok ... look at this chart of yours with these concepts in mind. We can’t see all the context but the immediate context is a bear channel (I drew in the bottom channel line). In this case the apex is at the top of the bear channel. The expected BO attempt would likely be south (converging patterns here...channel and triangle). So, to short is the higher probability trade. What is a logical PT? Somewhere in the bottom third of the channel. Then what? Cover and reverse and go long. If I did so and the long position goes against me I would just add to the losing position. Why? BO’s out of a channel fail most of the time and price will go back into the channel. So, if I averaged down on the long I would exit around the middle of the channel. Why not the top for the exit? Because it is a bear channel so pressure is down and I wouldn’t try to capture alot of profit. If I went long at the bottom of the channel and did not need to average down and price reverses up I might hold and exit in the top third of the channel. So what happened? Price broke south out of Apex and traded into the bottom third (dashed blue lines) of the bear channel then reversed back up on that green bull bar into the top third of the channel and (even though you don’t show it in your chart) I suspect it went on up into the top third of the channel and maybe even further as the bulls pushed back against the BO of the triangle (trying to make it fail). As mentioned earlier this is how I would trade this. My opinion only. BOTTOM LINE: any pattern I am considering trading I want to see where it is or has formed at within the larger pattern and what type of pattern the larger pattern is. In addition, at times I will look at a smaller TF and a larger TF than the one I am placing trades in and which contains the pattern i am attempting to trade. Converging patterns can give a better edge. NOT EVERY SYMMETRICAL TRIANGLE IS EQUAL IN PRESSURES IN TERMS OF DIRECTIONAL MOVEMENT ALTHOUGH THE VERY TRIANGLE ITSELF IS EQUAL IN PRESSURES AND THAT IS WHY IT IS SYMMETRICAL. Maybe this will make sense or could be it just muddies the waters for some traders?? Anyways it is my opinion and how I would trade this. But I am a scalper and a discretional one at that.
MarkBrown, Thanks, but I am not sure I fully understand you. My thought process is : Open a chart and trade what I see is happen at the moment in time. Yes, I look at daily chart. Yes, I look at weekly, but only to drawlines. But when I turn on my computer in the morning. Time to get busy. Its time to make some decisions, long or short and logical.
volpri < there is the best help you have gotten right there - obvious he knows the style you are trading. there is some art to line trading and juggling many possibilities in your head and he explains it very well. I am just throwing ideas cause I suck trading fixed zones. This is the 1st hour High -Low trading range. FIB-A-NACHO LINES BELOW
MarkBrown, Do you see the trade above where crude oil went up strong and fast? This is why I believe trader have to stare at one chart all day. You do not know what is going to happen next. I agree with you my 3 minute chart may be too long to wait.
MarkBrown, Now lets say a trader was starring at Crude Oil all day on 5 minute chart or 10 range chart or whatever. The trader get tired cause seems choppy right? He call it a day and go play outside. He missed the big +50 tick trade 30 minutes. Do you see now? The trader must trade the trenches allllll day long waiting for the opportunity to make money. Stare at the chart, waiting. trader must know how to trade every market condition , every day. A trader miss these skills if coding all day long and clicking back test button.
So you watched 3 failed breakdowns at consecutive lower lows and then you got into a long and exited before price tested the day's highs? Nice trade, but do you see living in the moment had you blind even to where today's highs were and the fact that there are stops above that level that will propel price higher giving you more profits? Foreground - I think its going up Background - Stops above high of day
yes i hear what you say and agree - i am just saying that if you take that data and spread it out to make it smoother and then use contraction to locate just a few explosive possibilities.