Trading the Cup & Handle Pattern

Discussion in 'Journals' started by almx, Aug 21, 2024.

  1. https://qullamaggie.com/my-3-timeless-setups-that-have-made-me-tens-of-millions/
    1. A range expansion (breakout) out of that consolidation. The consolidation phase is usually 2 weeks to 2 months. During the consolidation the stock price “surfs” the rising 10- and 20-day. and sometimes toe 50-day moving average.

    This is NVDA so it meets the criteria for this set up.


    So you can see it does exactly as projected...2-3 months...surfs the 10/20 etc.

    upload_2024-8-21_8-11-10.png


    The EW version

    upload_2024-8-21_8-29-56.png



    BUT here was the previous consolidation. How many times are you stopped out before the breakout?

    upload_2024-8-21_8-22-57.png



    When really all that is happening is a single correction. I keep telling you guys, if you don't understand EW you are only seeing the partial picture, and are trying to fill in the blanks with nefarious methods...I mean the price will surf the MA's prior to breaking out, but it will also surf them for every false break out. EW would tell me the first 3 breakouts were false. :)

    upload_2024-8-21_8-17-20.png
     
    Last edited: Aug 21, 2024
    #21     Aug 21, 2024
  2. If you understood Elliott wave then you would understand that its not a point of view...its like watching a movie trailer instead of seeing the entire movie...granted after some movie trailers there is really no need to see the movie anymore as they give out so much plot, but I digress. :)
     
    #22     Aug 21, 2024
  3. almx

    almx

    Ok, I think I have enough of you theory...
     
    #23     Aug 21, 2024
  4. Well good luck with your journey. :)

    [​IMG]
     
    #24     Aug 21, 2024
  5. MarkBrown

    MarkBrown

    In trading, using the word "would" is indeed considered risky or dangerous, primarily because it implies a level of certainty or prediction about future market movements that is not grounded in reality. The markets are inherently unpredictable, and making definitive statements about what "would" happen can lead to overconfidence and potentially significant losses.

    Key reasons why "would" is dangerous in trading:

    1. Overconfidence Bias: Saying that a market "would" move in a certain direction suggests a certainty that doesn't exist. This can lead traders to take on more risk than they should, underestimating the possibility of alternative outcomes.

    2. Lack of Flexibility: The market is dynamic, and outcomes are influenced by a myriad of factors that can change rapidly. Using "would" locks a trader into a fixed mindset, making it harder to adapt to new information or changing conditions.

    3. Misleading for Others: For those offering advice or predictions to others, using "would" can mislead less experienced traders into believing that the outcome is guaranteed, potentially leading them into poor decision-making.

    4. Emotional Impact: When the expected outcome does not materialize, traders who were certain about what "would" happen may experience stronger emotional reactions, such as frustration or panic, which can impair their judgment.
    In contrast, using more tentative language like "could," "might," or "may" acknowledges the inherent uncertainty of trading and encourages a more cautious, flexible approach. This kind of language allows for the consideration of multiple scenarios and outcomes, which is crucial for effective risk management in trading.
     
    #25     Aug 21, 2024
    Handle123 likes this.
  6. almx

    almx

    You are certainly correct about the definition but you are taking that word out of its context.

    And that context is that the trade to which that work refers to, takes place in the past, it's a back test trade if you prefer, so all of your points which would have been correct if I had been trying to predict anything in the future are irrelevant here.

    You will see, that when I will post my live trades here, for which the outcome will be unknown, you will never see any of those words, not even could, might or may, simply because I'm not in the game of predicting anything only in trading the better I can when I think I recognize a decent and correct setup, that's all, nothing less, nothing more.

    As a side note, also, English is not my mother tongue, my first and natural language is French, after what comes Spanish, and only then comes English, that's why you certainly noted that I don't express myself like most people here, so don't be too picky about my grammar or if from time to time I flip one word for another.
     
    #26     Aug 21, 2024
  7. MarkBrown

    MarkBrown

    would have is fictional until it's real
     
    #27     Aug 21, 2024
  8. almx

    almx

    Aren't Stan Weinstein stages and Wyckof phases the same ? For me, looks like...
    Studied Quallamaggie and Minervini in the past but definitely not my style but that doesn't mean that I won't study them again in the future...
    I don't know Jim Roppel, will do some research about him, thanks for the tip.

    Filtering yes, but in my case I see C&H's that are not perfect from the criteria side but that still do well and also the contrary, so when I enter a trade, I try to go with a neutral to negative bias, meaning that the trade is wrong until it proves otherwise.

    Thanks!
     
    #28     Aug 21, 2024
  9. almx

    almx

    There I learnt something :fistbump:
     
    #29     Aug 21, 2024
    MarkBrown likes this.
  10. Darc

    Darc

    If you'd studied Minervini's strategy you'd understand Weinstein's stage analysis as it forms the basis of Minervini strategy (chapter 5).

    Secondly, Minervini also exp!ains Jilers Cup n Handle, which you disputed.
     
    #30     Aug 21, 2024