Quote from usman88:
The triple bottom at 4340 was the best time to enter. Infact it was one of the easiest possible enteries because surprisingly stop hunting didnt took place there. Going back at that time, one would see price getting support there, therefore with a very tight stop loss of 5-10 ticks below the first bottom you get into a long position with a target of at least 80 cents(because if it go up it will test previous high of 44.30. One could have cashed in at 80 cents or put a trailing stop(the obvious thing to do) and let it run.
Thats more than 1:10 RR ratio. Textbook entry
Aloha mate and thanks for sharing how you would have traded that..
I always find it helpful to look at as many peoples different views as possible.
Can i ask if you actually have access to live volume data for oil though, and if so is it free, and if so where you get it from??
Since while i do see that the triple bounce at the 43.40 level could have looked like a possible long entry for some people,
when looking at the chart its clear to see that there had just been a head n shoulders formation, which had sent oil down 1dollar to this level here,
and as we have all seen over the last few months of this year that intraday trend moves like that often last for 3 - 4dollars,
so going long after just 1dollar drop seems to only be logical if you have access to volume data at the time showing the increased buying interest/lack of further selling there.
I personally dont ever trust double/triple/multiple tops or bottoms anyways though,
since 90% of the time they simpy are a tempory blockade that gets blasted by a breakout move.
(I always remember the explantion from a book i read called 'tricks of the floor trader', where the guy explained that if you look at a triple bottom,
all that it is is the market finding buyers at that level, but also still having sufficent selling pressure to repeatedly slam it back down to the base.
While it may not break down through that base the 1st few times, it also isnt a sign of strength at all, since the sellers are now using the price as a battering ram against that base, and are powerful enough as they are repeatly preventing the price for rising up each time it tries to).
Thats why ive never ever trusted multiple top formatiosn as solid or reversals,
and so only trust and use head n shoulders, and occasionally diamond formations.
I know i shouldnt be spending so much time still obsessing about this situation,
since i did some extremely stylish and precise trading of buying very near the lows of yesterday as the market moved straight in my favour, i cashed out very near the top of the 1st spike of the day,
which was then met seconds later by a pullback down equal to the size of the entire spike.
And i ended the day with 11% profit, and covering 144ticks profit.
But I just still am extremely interested and entralled by the price action that occured in this time frame though,
as through my eyes it just looks extremely odd and illogical,
and therefore i know in the future i again wouldnt buy when i saw movement like that,
but i dont want to again miss out on extra money, just because i have difficulty seeing a certain angle or aspect of this price action.
