Ross Hooks (or other patterns) entries based off of stop loss distance

[trademan1]

I don't caught up too much in identifying "trends". I prefer to think of my trades as momentum impulse signals although my methodology is based on "trend pullback". Congestion is simply another form of corrective action as is the more obvious and clean pullback. I have signals which I enter in consolidation patterns, based on the same principles as simple pullbacks. None of us see charts in the same way and have to develop PA cognizance which is meaningful to each trader. Trading would be easy if all patterns looked like textbook examples.

You do identify congestion though in order to determine your entry based off of congestion versus your entry based off of clean pullback or trend? Certainly congestion can cause you to enter a trade prematurely where there is no "trend" in place for which your strategy would normally work.

I guess I'm saying, you don't just lump congestion into the same category as a simple pullback?

 

[speedo]

You do identify congestion though in order to determine your entry based off of congestion versus your entry based off of clean pullback or trend? Certainly congestion can cause you to enter a trade prematurely where there is no "trend" in place for which your strategy would normally work.

I guess I'm saying, you don't just lump congestion into the same category as a simple pullback?

There is usually order in congestion, it's just not as easy to identify. A clean and orderly pullback may or not work as any would any setup.

 

[trademan1]

There is usually order in congestion, it's just not as easy to identify. A clean and orderly pullback may or not work as any would any setup.

By "order" do you mean setups such as range/block breaks and things such as that in congestion?

 

[speedo]

There is structure, support and resistance elements which serve similar purpose as pullback entries. Price action is fractal, I employ 3 different time frames to get wide angle, medium and closeup looks at PA. What appears to be random noise can be a fairly clean structure on a higher tf, thus there are congestion entries which provide decent R/R. I don't consider them breakout trades but just more complex momentum continuation patterns. If I have time tomorrow, I will post an example or two.

 

[trademan1]

There is structure, support and resistance elements which serve similar purpose as pullback entries. Price action is fractal, I employ 3 different time frames to get wide angle, medium and closeup looks at PA. What appears to be random noise can be a fairly clean structure on a higher tf, thus there are congestion entries which provide decent R/R. I don't consider them breakout trades but just more complex momentum continuation patterns. If I have time tomorrow, I will post an example or two.

Thank you, will be interested in seeing the examples.

 

[speedo]

...also, while others don't care to use them, I find MA's and an oscillator useful in differentiating between continuation vs reversal.

 

[trademan1]

...also, while others don't care to use them, I find MA's and an oscillator useful in differentiating between continuation vs reversal.

Interesting.
Such as MA crosses or directional?
Stochastic staying above/below certain levels?

 

[speedo]

Interesting.
Such as MA crosses or directional?
Stochastic staying above/below certain levels?

An MA cross in a lower tf can be simply a garden variety pull back in a higher. I need to see the momentum and PA dynamics in all three to determine whether I treat it as a reversal or a continuation. There is of course nothing fail safe but I it gives me a definitive signal one way or the other. I don't want to be doing analysis during the trading day. If an oscillator is pinned low, that's bearish (in that timeframe) and supports a lower bias but everything I look at is in the context of the rest of my chart environment.

 

[speedo]

Here is a congestion zone on the NQ on the 21st

 

[speedo]

Here is the same zone marked by the vertical lines on my next higher time frame, the 1500 tick