Here, for example, DbPhoenix draws the range somewhat differently from the way I defined it for myself, but the differences would likely prove to be immaterial to how one would then trade it.
Observations (an example)
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Here, for example, DbPhoenix draws the range somewhat differently from the way I defined it for myself, but the differences would likely prove to be immaterial to how one would then trade it.
Immaterial perhaps in terms of what one looks for. I'm primarily interested in where traders wouldn't go at all as well as where traders tried to go but couldn't hold. Your blue line shows the former. Your pink line could actually be a little lower (or maybe it's mine). I don't go with the absolute high or low unless they've been tested, as the lows are here. What I'm most interested in, though, is how traders behave if and when they approach those swing points. If there is only one swing high, it's not likely to influence behavior much since so few trades created it. If there are several swing points reaching the same level, these represent many more trades and are thus more likely to influence behavior.
As I wrote somewhere or other, a swing point represents a different kind of resistance than the upper limit of a range. The latter is where many trades took place and created that upper limit. In a sense, it represents value. Or did. A swing point, on the other hand, represents a point beyond which traders couldn't find or make trades. The "volume" may be almost non-existent. But because it's a point beyond which traders couldn't go, it's still resistance of a sort, but not nearly as strong.
Just to be clear, that first pink arrow would likely not present much of a problem. It's close enough to the body of the range and short-lived enough that it probably won't present much resistance. That double top under the second arrow, though, is a whole different situation. Traders put much more effort into pushing higher and couldn't, so this will likely provide greater resistance. Which may be why the next effort, at the third arrow, was so brief. Note, however, that the lower high immediately thereafter is on the same level as that previous double top. Therefore, that's the level I'd look at for important action, not the swing high at that third arrow. When it does try, at the fourth arrow, it has a shallow retrace, which provides a nice entry.
And yes, it's all hindsight. But the psychology is there for anyone who wants to and knows how to read it, and it will happen again. And again. What is important to me is that while many traders would see a series of higher highs, I see a range and repeated failures to escape it. Note that that shallow retrace I mentioned holds above it.
And yes, it's all hindsight. But the psychology is there for anyone who wants to and knows how to read it, and it will happen again. And again. What is important to me is that while many traders would see a series of higher highs, I see a range and repeated failures to escape it. Note that that shallow retrace I mentioned holds above it.
Just before 8 AM EST
90 seconds to "ding ding ding"
Where might it be heading?
Missed it by that much ... took scale profits 35, stopped 37-38's
Too much to focus - I'm looking for either a continuation to the top of the range or failure around these levels to re-short. You get the idea. Can't keep posting
Last post Failure high & SLA
sold 40 stop 41.75, scale out 35, stop move 37.75 limit order at 31.50
sold 40 stop 41.75, scale out 35, stop move 37.75 limit order at 31.50
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Ok, I am done for the day. Step One, find a range, step 2 identify where price is within the range, step 3 trade price.
IMO, those who do not believe in the efficacy of Wyckoff, Trading Areas, AMT, and DbPhoenix's SLA are like members of the Flat Earth Society.
IMO, those who do not believe in the efficacy of Wyckoff, Trading Areas, AMT, and DbPhoenix's SLA are like members of the Flat Earth Society.
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