Potential NQ Targets
- Thread starter dbphoenix
- Start date
I had a hunch this was the answer, but I'm seeing that I need to be told things over and over again so thank-you once again for such a perfect answer!
Because of NoDoji's excellent advice to read that book on mindset, I know that I can learn this and eventually it will sink in, allowing me to make full use of everything that you teach.
Because of NoDoji's excellent advice to read that book on mindset, I know that I can learn this and eventually it will sink in, allowing me to make full use of everything that you teach.
Yes, it's incorrect. Your trend channel is drawn incorrectly, so whatever mean there might be is useless for trading.
A reversion to a mean isn't going to do you any good unless you're looking at the same price movements -- and their means -- as professionals, such as the channel I drew in the first post (this should not imply that professionals necessarily look at channels; the channels are merely "footprints"). Once price reversed off that mean, then it's back to the balance between supply and demand.
This morning, for example, supply had the upper hand, but soon after the open, demand took over and rose 35pts. Several people saw this trade but didn't take it out of fear. But that's a problem that's outside this particular approach. One can't profit from a trade he doesn't take.
A reversion to a mean isn't going to do you any good unless you're looking at the same price movements -- and their means -- as professionals, such as the channel I drew in the first post (this should not imply that professionals necessarily look at channels; the channels are merely "footprints"). Once price reversed off that mean, then it's back to the balance between supply and demand.
This morning, for example, supply had the upper hand, but soon after the open, demand took over and rose 35pts. Several people saw this trade but didn't take it out of fear. But that's a problem that's outside this particular approach. One can't profit from a trade he doesn't take.
Gotcha. I didn't have a channel drawn I just saw how price was trading to and from that line. Saw it as a potential place price may come back to. Today it just happened to work out that way. I get what you mean though. I anticipated that response but just figured I would ask. As far as trades I only took two one short one long. Thanks as always.
Price will trade back and forth across many lines, or points. That's what the auction market is all about. But unless you're scalping, all that is irrelevant. The trade was when price failed to hold 20 back on the 18th. After that, it was just a matter of holding until it reached the mean, as it did yesterday. Whether or not one wants to daytrade doesn't change the most probable direction: down.