My point isn't you were right or wrong: I suggest one TA view supports a long, but another supports a short. My point is you haven't made clear why you selected one not the other.
I Hate Reversals
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My point isn't you were right or wrong: I suggest one TA view supports a long, but another supports a short. My point is you haven't made clear why you selected one not the other.
Ok, there are two charts attached.Your thoughts, please?Why you pick one over the other?
mostly yes.
Like you (I think?), I instinctively mistrust reversal-entries, in general.
More specifically, though, I do trade some (from fast-moving, constant-volume, intraday charts), taking only entries in the overall direction of a suitable longer (but still intraday) trend.
In other words, I'm trying to catch only reversals out of a recent correction/retracement and back into a broader trend.
I use bar-patterns (e.g. selected classic 1-2-3 formations) for my entry timing, setting an initial stop-loss above the most recently formed swing-high/low.
These are fast-moving trades, which some people - perhaps including previous posters in this thread - might classify (wrongly, in my view) as "trading noise".
Whether they're "noise" or not, I believe that it's not particularly difficult, with practice, to achieve a 70-75% win-rate on a 1:1 R:R, trading these ... and sometimes it's possible to achieve significantly better R:R's than that, with stop-loss adjustments along the way.
It's both "discretionary" and "structured".
I see, so your grinding...Probably one of the few ways to make it.
Thanks for your input.
That sounds similar to "MAC"'s strategy (who was influenced by Al Brooks, who I know influenced you). He even shoots for the same win rate and 1:1 risk/reward. Did you ever directly incorporate his strategies into your own?
Bar by bar, I would have taken that short. I also would have taken the reversal of the reversal on that OB long.
This second reversal back into the long was not invalidated by a third reversal. By zooming out and including more bars, as short volume arrives and increases, price fails from falling, instead price is still trending up thereby confirming the long as still valid and progressing.
10 price cases are building blocks. By adding a third bar and the resulting permutations of volume a catalog gets built upon previous work. One could continue and define 4, 5, 6, etc. bar cases and volume permutations.
As with all catalogs there are some items (bar clusters of various sizes, volatility and volume profile) that offer better informational value than the others.
Differentiating Context is the key. Context determines whether something is included or excluded within a set domain.
Context is also multi-dimensional. In other words they ‘nest’ within each other at different aggregate levels. This is loosely coupled to timeframes and more tightly coupled to tapes/traverses/channels. The latter which are operational on multiple timeframes.
It’s certainly easier to see in hindsight. In real-time, at my current level of understanding, it’s about 17 logical calculations being performed on a minute by minute basis. A majority of these calculations wait until volume ‘lock-in’ which occurs before EOB. As a caveat there are context’s where ‘lock-in’ is premature and the last 30secs of a 5min bar determines it’s EOB case.
Unless one understands the concepts of permission and suppression of volume measurements the above concepts are difficult to backtest with any degree of accuracy to the point of being impossible.
It’s a different paradigm.
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No ... I think I know who you mean (this is the thing called "Mac's PAT strategy", or something similar???), but I've never actually seen it. Nearly all my trades are "with the trend" ... the ones I've described briefly above are the only reversals I do.