A simple price action approach
- Thread starter metal
- Start date
What I always tried to do was avoid confusion. I would look for the largest, most structural channel or tl in the chart and focus on that. Something that had at least one higher high or lower low in it. It meant less opportunity but I was ok with having days on which no trades presented themselves. I always figured I'd never survive this game if I started trying to take 8 tick profit targets, so instead tried to develop a gameplan where I'd patiently wait for setups that would target large intraday swings.
To my eyes it seems like you're drawing lines between any swing highs or lows on the chart, even the most minor ones. If I try to do that I get a huge mess on the chart.
To my eyes it seems like you're drawing lines between any swing highs or lows on the chart, even the most minor ones. If I try to do that I get a huge mess on the chart.
And stuff like this.... I try to keep an open mind but have to call a spade a spade on this one. This is hindsight art, not real trading. On a couple of those trades there's no way you could have had the channel drawn that early in the chart to even be able to trade off it.
It would be awesome if we could make the market conform to a nice rigid structure like this every day but unfortunately it doesn't work that way in reality.
Cornix, have to say I see some of those tl's as a point of confusion. The ones where you connect a swing high and with a second swing high that is not followed by a lower low. From what I have read, a tl is denoting a trend in one direction either a high and a higher high or a low and a lower low at minimum. In the chart below the longer red line seems premature because there isn't even a downtrend in that "cycle" yet. The shorter red line makes sense as there is a mini-downtrend there within the larger downtrend.
Nevertheless if I understand what you're getting at, the trades you suggest have nothing to do with price bouncing off trendlines and are more about the 123 patterns. That is no surprise to me considering what I know of your trading. Contrary to my initial expections, you don't have many trades of the textbook tl test, retest, breakout varieties that appear across the internet. It's just that /that stuff looks so good in hindsight that it's hard not to get sucked into trying to trade it....
PS - I do use trendlines as a part of my longer term trading and have been profitable, so to clarify my criticisms of this are only related to daytrading.
Nevertheless if I understand what you're getting at, the trades you suggest have nothing to do with price bouncing off trendlines and are more about the 123 patterns. That is no surprise to me considering what I know of your trading. Contrary to my initial expections, you don't have many trades of the textbook tl test, retest, breakout varieties that appear across the internet. It's just that /that stuff looks so good in hindsight that it's hard not to get sucked into trying to trade it....
PS - I do use trendlines as a part of my longer term trading and have been profitable, so to clarify my criticisms of this are only related to daytrading.
Trend lines are extremely subjective, many factors add to this subjectivity.
I will just name a few.
A downtrending line in a 15min chart does not attach to the pivots the same way a 60min would, therefore, is not just which is the correct style but on which time frame? Which downtrendline are you using, 60min, daily, weekly, monthly ? All will be different.
Let's add to the complexity as well, how much data are you loading ? The more data you load the more pivots you could find, and this will change slope.
Style of drawing them. At swing highs/lows ? At the Close ? At the Open ? If a doji is present, at the doji open/close?
Do you stick to the extreme pivots or do you draw new ones as trend gets strong and more aggressive pivots develop ?
Style of alignment, do you redraw when one is broken or slight bend by a stop run ?
Can go on forever, but most traders that talk about trend lines rarely mention the harsh reality, they are extremely subjective and countless methods exist on how to draw them.
Disclaimer: At no time I stated my opinion on their usefulness or lack of, I'm only stating that they are extremely subjective.
I will just name a few.
A downtrending line in a 15min chart does not attach to the pivots the same way a 60min would, therefore, is not just which is the correct style but on which time frame? Which downtrendline are you using, 60min, daily, weekly, monthly ? All will be different.
Let's add to the complexity as well, how much data are you loading ? The more data you load the more pivots you could find, and this will change slope.
Style of drawing them. At swing highs/lows ? At the Close ? At the Open ? If a doji is present, at the doji open/close?
Do you stick to the extreme pivots or do you draw new ones as trend gets strong and more aggressive pivots develop ?
Style of alignment, do you redraw when one is broken or slight bend by a stop run ?
Can go on forever, but most traders that talk about trend lines rarely mention the harsh reality, they are extremely subjective and countless methods exist on how to draw them.
Disclaimer: At no time I stated my opinion on their usefulness or lack of, I'm only stating that they are extremely subjective.
sorry about the writing style and the thought process behind it,it is what it is,trader not a literary,the L is a ledge and the C is a cleave,N is a nip,add these to the trendlines and you have cornix's areas of targets or congestion or places where a move might stop, i use them as targets this is a 1 year chart,you have to use several charts of different timeframes starting large and working to small,on this chart the 88 ledge is wide and the 82 ledge very small,suggests that the 88 will hold and the 82 ,todays current low, won't ,79 below it is also small. May not happen today but that 73-69 is where ther might be enough buyers,short covering to stop the downmove
Thanks, Ammo. I am only up to page 50 of this thread. I am studying your posts along with a few others (Nodoji, Xpurt, Metal). I print the attached charts out so I can study when I am not at the computer. For some reason I study and absorb the concepts better this way than I do sitting in from of the computer.
I like your idea of using volume profile as a part of predicting trend lines, predicting resistance or support. It seems by your charts that you use TOS. I am also on TOS. I study Monkey Bars to determine where points of control can be found. I think Monkey bars are slightly different from your volume profile, but they match up about the same.