Is It a Reversal or a Pullback?

[i am nobody]

I guess what happened in the last 5 minutes is the best way to guess what will happen in the next 5. Expect more of the same

If you drive on a unknow road, what do you do? You adapt your driving style to the road. Your visual observations help you to use the optimal drivin style. You don’t care how the road will be in 50 miles. You only care about now. And as the road is unknow you have no clue where it will go so it is impossible to know the road 50 miles ahead.
Trading is like driving. It is unknown where the market will go in the end. So you observe visually what you see and act on that. The only real information you have is what you see, all the rest is guessing which means uncertain. Support/resistance? Pullback or reversal? All guesses without any real proof (except in hindsight).

If you master this part, the next step is to see the patterns. Roads are many times build following a certain logic. For example: on highways you can drive faster as these roads have less curves or at least curves that are smooth so that you do not have to slow down. You also don't have to stop on highways, so you can keep speed higher.
The same apllies to trading. Humans interfere and create patterns. These patterns should be found. If you do find them it will become possible to guess with high probability more in future.

 

[schizo]

Trading is like driving. It is unknown where the market will go in the end.

Wrong again. You clearly need to know where you must go ahead of time before embarking on a trip. That's why you need a MAP. Likewise, you need a PLAN when it comes to trading.

Having a trading plan is like having a road map.

 

[i am nobody]

Wrong again. You clearly need to know where you must go ahead of time before embarking on a trip. That's why you need a MAP. Likewise, you need a PLAN when it comes to trading.

Having a trading plan is like having a road map.

A road map is real and does not change.
A tradeplan is based on assumptions and probabilities. So a huge difference.
If you follow a roadmap you will 100% of the time arrive where you want to go (if you can read a map) . The fact that you make about 50% of losing trades with your tradeplan is the ultimate proof that you are wrong. Your tradeplan is where you would like to go, but in 50% of the cases you never get there. You get complely lost 50% of the time. Your trading results confirm this.

90% of the traders never become profitable which proofs that there is a HUGE difference between a roadmap and a tradeplan. A roadmap gives you with 100% certainty the road as it is. A tradeplan not.

Roadmaps are based on REALITY.
Tradeplans are based on ASSUMPTIONS and PROBABILITIES. If not you would always have winning trades.

 

[kut2k2]

A road map is real and does not change.
A tradeplan is based on assumptions and probabilities. So a huge difference.
If you follow a roadmap you will 100% of the time arrive where you want to go (if you can read a map) . The fact that you make about 50% of losing trades with your tradeplan is the ultimate proof that you are wrong. Your tradeplan is where you would like to go, but in 50% of the cases you never get there. You get complely lost 50% of the time. Your trading results confirm this.

90% of the traders never become profitable which proofs that there is a HUGE difference between a roadmap and a tradeplan. A roadmap gives you with 100% certainty the road as it is. A tradeplan not.

Roadmaps are based on REALITY.
Tradeplans are based on ASSUMPTIONS and PROBABILITIES. If not you would always have winning trades.

If your trading plan has a winrate of only 50% then you need a better trading plan. And they do exist.

 

[speedo]

If your trading plan has a winrate of only 50% then you need a better trading plan. And they do exist.

Nothing wrong with a 50% win rate if you are 4-1 wins to losses. There are endless ways to skin a cat. The question of reversal or pullback should be answered in the time frame(s) you trade.

 

[speedo]

That is win size to loss size.

 

[i am nobody]

If your trading plan has a winrate of only 50% then you need a better trading plan. And they do exist.

That's what I say all the time. But some people don't like my remark.
If it will be 100% then it will be like a roadmap. So in reality it will never be a roadmap.

 

[Aj2014]

I can get a kick ass win rate if I use large stops and small profit targets

Is this a V bottom on teh ES here intraday? read for further upside? Or is it gonna turn back down here?

 

[kut2k2]

That's what I say all the time. But some people don't like my remark.
If it will be 100% then it will be like a roadmap. So in reality it will never be a roadmap.

OK roadmap isn't the right analogy. But there are explorer maps over territory that hasn't been fully surveyed and recorded. An explorer map has unknown areas, dead ends and yet to be discovered hazards. Not unlike a trading plan that can't possibly predict the future perfectly but is the best possible plan based on logic and probabilities.

 

[speedo]

Market is fast this morning so I want to make my prior post understood. If someone has a 50% win rate but his or her average gain size is multiples of average loss size, that is a good trade plan. Stats on the former are meaningless without knowing the latter.