Worked in the garden for 2 1/2 hours at 1100 and went back out after 1500 to net the fruit trees. Is this important to you?
Ordinarily I don't bother with very short-term channels. Even though traders' behavior is creating them, few are aware of them. However, since we are back where we started, which provides a new trading opportunity, and since this channel is so obvious, it seemed a good idea to point out the difference in dynamics between a lateral channel and a diagonal one. A lateral channel and a diagonal one are both ranges: price goes up and down within them. However, in a diagonal range, the quantity of shares or contracts traded at the point at which price reverses off the upper and lower limits of the channel will be considerably different than the quantity of shares or contracts traded at the same points in a lateral range. For example, the value of sh/con traded at A are not going to be the same as the value traded at B (the quantity might be the same, but the value will be different as the prices are different). And those are not going to be the same as the value traded at C. Or D. But if this were flattened, the quantities traded at A, B, C, and D would be more or less combined along with the values. Ditto the values traded at X and Y. Therefore, even though the trader is trading reversals both within a diagonal channel and within a lateral channel (or range), the dynamics of those trades are going to be different due in large part to the quantity of sh/con involved. One not necessarily better than the other, just different. There are other differences, of course: differences in perceptions of up and down and higher and lower, and differences in the lengths of the trending and counter-trending waves in a diagonal channel, and of course the factor of time. Nonetheless, all the trades are reversal trades, and trading them isn't nearly as boring as it might seem, particularly when diagonal and lateral ranges intersect (that results in a disruption of the space-time continuum and the possible end of life as we know it). This is admittedly a sort of Dick And Jane of trading reversals, but there's always the possibility that this stuff may not have occurred to the beginners.
Well I'm flattered that you would be so fascinated with me that you would track my movements during the day. I'm surprised you have the time.
Here is my analysis of today's activity on the NQ 15 min chart. Just two trades identified on the 15 today. Unfortunately one of those was hours prior to the NY open and I would not have been awake to take the trade anyway. Some may wonder why the first short is allowed to come all the way back and the answer to that is that any stop reduction prior to that would have put the stop in the noise. In addition, the bear flag that was forming would suggest further downside and one would be careful to adjust stop too early. In order to reap full benefit, I try to endure retracements.
Here is the 5 min chart of NQ today. Somewhat tradeable but the real action today was on the 1 min chart. I did not mark the outside bar that was the beginning of the big drop because there was some question with this system on the 5 min as to whether or not it was a valid signal and we don't want to curve-fit. On the 1 min chart though there was a short signal at this level that would have confirmed to sell there. My thought is that it's best to keep several different timeframes open at once so that you can see signals that appear in tandem or in confirmation. Always best to have at least 2 and preferably 3 charts in agreement. Notice that the first short signal was not valid and would have been stopped out. We would though have obtained the 5 or 6 points that SLA typically suggests. That's not enough for me though and I would rather take bigger gains. The afternoon activity contained iffy signals at least on this timeframe and not trades were identified.
The SLA short, on the other hand, would have been later and higher and garnered much more than 5 or 6 points.