Quote from arzoo:
Sorry i wasnt clear, i was looking for intraday signals.
Intraday, you pretty much have to use some sort of oscillator to detect divergence, like Cathy suggested, unless you're good at using volume for the same purpose. If that divergence shows, depending on where it shows, then you're most likely looking at a reversal. In a good retracement, there probably won't be time for a clear divergence to appear.
There's also the issue of S/R. Reversals are far more likely to occur when S/R is tested during the main thrust of the trade. But if price turns for no special reason and tests S/R in the counter-thrust, you're more likely to be looking at a ret.
As for the base business, a lot depends on the length and breadth of the base. The most reliable BOs take place from bases that are at least two hours long, and the tighter, the better (like today). When they take off, though, THEY TAKE OFF. Know exactly what you're going to do to take advantage of these BOs or you can either get screwed or miss out on the move entirely.
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.
Go back over the last couple of months and look for bases. See which ones work and which don't and why. Then print them out and have them handy so you can remind yourself of what to look for when the next occasion presents itself.
