IN THIS THREAD: IronFist learns (the elusive) PRICE ACTION
- Thread starter IronFist
- Start date
In an uptrend with higher highs and higher lows, you can enter on a pullback using the trader's trick entry, described in this PDF file:
http://www.trading-naked.com/library/Traders_Trick_Entry.pdf
Briefly, the trader's trick entry is executed as follows: When you have an uptrend with progressively higher bars, then you get a pullback with at least 3 progressively lower bars, you set a limit order 1-2 ticks above the high of each successive pullback bar during the last few seconds that it is forming. When price starts going up and exceeds the high of the prior bar, you get filled. Set your stop loss 1 tick below the low of the of the deepest bar in the pullback. If price goes below that level, that is when you know you have a reversal and not a pullback, causing you to get stopped out.
Another way to enter on a pull back is by using Heiken Ashi bars. If up bars are green in an uptrend and down bars are red in a pullback, you can enter as soon as you get your first green bar in the pullback.
A third way to enter on a pullback is to watch price action on multiple time frames. If your main chart is a 400 tick chart and you are watching a pullback forming in an uptrend, you can also be watching a 40 tick chart (for example). When a pullback is occurring on the 400 tick chart in an uptrend and you notice on the 40 tick chart that price is starting to make higher highs and higher lows, then you can enter a long trade.
http://www.trading-naked.com/library/Traders_Trick_Entry.pdf
Briefly, the trader's trick entry is executed as follows: When you have an uptrend with progressively higher bars, then you get a pullback with at least 3 progressively lower bars, you set a limit order 1-2 ticks above the high of each successive pullback bar during the last few seconds that it is forming. When price starts going up and exceeds the high of the prior bar, you get filled. Set your stop loss 1 tick below the low of the of the deepest bar in the pullback. If price goes below that level, that is when you know you have a reversal and not a pullback, causing you to get stopped out.
Another way to enter on a pull back is by using Heiken Ashi bars. If up bars are green in an uptrend and down bars are red in a pullback, you can enter as soon as you get your first green bar in the pullback.
A third way to enter on a pullback is to watch price action on multiple time frames. If your main chart is a 400 tick chart and you are watching a pullback forming in an uptrend, you can also be watching a 40 tick chart (for example). When a pullback is occurring on the 400 tick chart in an uptrend and you notice on the 40 tick chart that price is starting to make higher highs and higher lows, then you can enter a long trade.
TTE should definately be in the toolbox! Good one!
And here is the "intro" if you will, to fully understand the concepts that are part of TTE...
http://www.trading-naked.com/library/Law_of_Charts.pdf
FWIW; Trading-naked has a decent library of free reading material, specific to trading. Even a few worth more than the cost, like TTE.
Here's the direct link to the library...http://www.trading-naked.com/Articles_and_Reprints.htm
Osorico
Fearless9 is worth your time, IMO. With the understanding that what works for him (or anyone else for that matter) may not work for you.
In my case, volume bars do not work. My analysis has a time element to it, which is non-existent with volume bars. That said, in low volume markets, such as overnight US indexes, range bars and PnF charts become very useful to me, although in both cases, there is no time element.
Gotta find things that work for your trading personality and trading style. Try something, even if it's wrong!
Osorico