Distinguishing between retracements & reversals

Quote from dbphoenix:



I suggest, tho, that you use a very tight stop. When these BOs don't work, they really don't work, regardless of whether you use a tight stop or not, so there's no point in wasting money. When they do work, the stop is not an issue since it's rarely touched, much less violated. Taking a trade such as TODAY's, then, becomes extremely low risk.
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The post you quote was written yesterday. The post you wrote was posted today. If you can stop being cute long enough to tell me what you want, we can go on from there.
 
you could try this:

put a 20 sma on your chart. price will follow it down in a trend. once the trend gets weak, it will break it. don't exit yet. wait for price to stop retracement and come back across 20 sma. now treat the furthest price on the break of the 20 sma as the reversal point. i think this was super_ego's method....
 
Quote from funky:

you could try this:

put a 20 sma on your chart. price will follow it down in a trend. once the trend gets weak, it will break it. don't exit yet. wait for price to stop retracement and come back across 20 sma. now treat the furthest price on the break of the 20 sma as the reversal point. i think this was super_ego's method....
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Actually, that's Welles Wilder (of ADX/SAR fame) . . . :p
 
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