A simple price action approach

1)The earlier you recognize a trend and can enter in an edge based setup, the more likely the trend will stay in place long enough for you to make a profit.

2) Trends do reverse. Think of resistance or support as a sand wall, as it keeps getting hit, the wall starts to crack and eventually will break.

3) There is no holy grail. No setups works 100% of the time, markets are sometimes random. So if it does not work, you need to be able to take a loss and either calmly wait for another setup or stop trading for the day, and trade again another day.

4) Markets also range which can be profitable setups too.

Quote from Zr1Trader:

Reason's for discarding an approach like this before are because of price sometimes respecting the line very well and other times not so well. Through my observations it seems like a failure to break the trend line (slightly penetrating the trendline faking in shorts, then a reverse back above the trend line causing shorts to cover while new buyers hop on the bandwagon as well) is when the good profit opportunities arise. For instance look at the attachment.

Just some observations from my end not saying anything is proven from data ect...
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Quote from Zr1Trader:

Reason's for discarding an approach like this before are because of price sometimes respecting the line very well and other times not so well. Through my observations it seems like a failure to break the trend line (slightly penetrating the trendline faking in shorts, then a reverse back above the trend line causing shorts to cover while new buyers hop on the bandwagon as well) is when the good profit opportunities arise.
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I think the fact that trends are respected more often than not, and you can wait until S/R is established and be the "second mouse" that avoids too many stop outs, AND the fact that a few small losses are easily paid for many times over when you catch the tending move, makes this method of trading net profitable and very consistent a long as you keep on trading the setups. If you start picking and choosing too much, you risk (as with anything based on probabilities) picking weak trades and passing on strong ones, which can ruin a profitable strategy.

Quote from metal:

Nice trading, NoDoji.

Here's my hindsight view of a 5min CL chart. Trendlines are partially art and you sometimes have to draw several until price starts respecting one.
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Thanks, metal. You had a couple more of my short trades from yesterday noted on that chart, BTW!

I also redraw trend lines and channels as price action evolves though the day. Trends can reverse, ranges can set in.

I also draw multiple channels if there are interim pivot highs/lows. I did that this morning and copied the chart of some trades I made based on the dual channels.

These same channels served me later in the day as well, for targeting profits on some long trades.

My charts are Pacific Time by the way.

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That looks a lot like my trades for today, NoDoji.

I notice you take shorts on up channels, and I wouldn't do this without other confluence. How do you treat that situation?

metal
 
Its neat to see so many people posting on trends and their containers. As has been reitierated by most: trend lines keep changing and only so often do you get one that works.

Certainly there is an answer that cures all these inaccuracies.

trends occur on all fractals cuncurrently. they build in a fixed ratio of 3:1.

Take the post of the person who did three parts to get a slower short; then he did three parts to get a long slower trend. But he enclosed the short and long with a heavy line that skipped drawing the RTL and LTL of what I just mentioned. Tthe ends of his bold line connect the wrong things together as a consequence.

none on this comes from annecdotal reasoning; deduction is used to get the singular pattern of trending in markets.

start with the finest size (ticks) and build your system from there.

On any chart adjacent bars allow you to build.

you find out two things in the process: You have to deal with the volatility changes in channels (trends).

All of this is in each poster's future if the reader reads and does what he is called upon to do (internally and not by me)

trends either accelerate or decelerate after the parallelogram is able to be drawn. Do VE's to accelerate and do fanning at "internals" to decelerate.

As another has said: FTT's are the name of the game. Trading on a given fractal is done from FTT to FTT.

The FTT is what ends a trend. A trend is there and annotated; you are in according to the RTL sentiment. You go in on the last FTT and then went through the BO of the RTL and on to point 2 of the parallelogram. Then from that peaking volume you went on hold to the trough of volume @ point 3 of the parallelogram which you then drew in order to see from point 3 the TREND FAIL TO TRAVERSE (FTT) to the LTL that you drew from point 2.

This is hold and reversal trading which no one here posting has graduated to as yet. You use edges and entry/exit trading and you predict and bet on your predictions. OODA trading. Trend monitoring and analysis precludes this silly practice.

Lets accelerate a trend on a VE of the LTL.

Move point 1 to point 3. Use the VE as point 2. Now look for the end of the trend at the FTT of the new container. Throw out the old container by non stationarity rules.

Lets take a look as an "internal" is appearing on a RTL. you have to slow down the trend at this point simce price is just meandering along the RTL on lower volumes. So fan the RTL from the point 1 where your hold began and duplicate (clone) the RTL and put it on the point 2 you are now ALREADY USING.

lets look back a bit. If you make trading trends out of ftt's on faster trends; then your trading on the slower trend is a snap and very free of fear, anxity, and anger. If you connect the FTT's of your trading trend you have a large outer trend container for your traverse trading from FTT to FTT (including the acceleration and deceleration adjustments.

THIS ALL CAN BE SO EASY IF YOU USE PRINCIPLES AND THEIR ORDER OF EVENTS.


BUT it will not happen for most of you. You will not take the time to follow my suggestions. You know you MUST and you will not.

most will continue to do the myth based annecdotal type hit or miss. some will nest fractals but skip and jump fractals in the process. All of you will continue to "take trades doing entry and exit.

will the day ever come when you figure out both entry and exit are the same but opposite things. I think not. YOU ARE JUST READING A LONG NONSENSICAL POST YOU WILL TRY AND TRY TO FORGET.
 
Quote from metal:

That looks a lot like my trades for today, NoDoji.

I notice you take shorts on up channels, and I wouldn't do this without other confluence. How do you treat that situation?

metal
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The chart I posted doesn't show the bigger picture of the move leading into the up channel. Price fell almost 2.00 (2 points) from the twin top around 100.50 that was put in at 5:40am PST. So the up channel was a pullback (potential bear flag) in a strong down trending move on the 5-min chart.

I got a late start this morning and wasn't ready to trade until about 10 minutes before the initial short noted on that chart. First thing I did was draw my lower TL, then add the channel line upon the close of the 6:55am PST bar because it retraced heavily and closed back beneath the 20-period EMA; however it was still a green close for that bar, so I waited for some confirmation (you never know when a pullback channel might become an actual trend reversal). There was a previous Support zone from earlier around 99.55. When price hit 99.55 and immediately sold off and this coincided with the upper channel line, I was ready to short, positioning myself for continuation of the previous down trend.

The channel however, might hold as support, so I was prepared to cover my short position if the lower line held, which it did, to the tick. Although I didn't note them on the chart, I had a few other trades in that initial channel, both long and short. I was prepared to go either way when price broke back up through the 20-period EMA.

The trend did finally continue down after the second channel overshoot left a virtual double top at previous resistance. That was an excellent short signal for continuation and a possible measured move (ended up making more than a measured move). As soon as the 7:30 and 7:45 bars closed, I drew another channel off those highs to guide me through the continuation move down.

CL is too volatile lately for me to hold through so many deep retraces, so I trade in chunks and the channels are very helpful for this. You can take profits in both directions in a channel, and when a breakout has follow through, you're positioned very well for the big move.
 
Quote from jack hershey:

some will nest fractals but skip and jump fractals in the process.
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This is a common and dangerous thing to do. It will either kill you or make you stronger (and wiser) :cool:
 
NoDoji , do you use 24hr charts?
I'm a bit lost on when/how long to draw a trend line, when to start, etc.
Do you let the Mkt develop an hour after the bell before drawing a trend line?
Thanks for any help.

Ian
 
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