What exactly will you be on the lookout for? What are your criteria for determining (a) whether or not there is a long to be had and (b) how to get it?
That was sloppy wording on my part. Sorry. If 3660 holds I will not be on the lookout for longs, I will assume that the line of least resistance is up. I will then enter long if any of my defined entry "pictures" show up. I have the following alternatives:
Enter on the first retrace after:
- a breakout of a range
- a breakout of a hinge
In these cases the new demand or supply line is anticipated as it can not be drawn yet (unless one starts the line in the range/hinge) and I am prepared to scratch the trade quickly.
Enter on the first
or second retrace after:
- a break of a demand or supply line
The reason for also considering the second retrace is that the first retrace in the new trend might occur before the demand or supply line is broken (usually depending on how steep the broken line is). I am still backtesting and many things are still unclear and how to handle this is one of them. The "profile" of the retrace is another thing I am still looking at (deep, shallow, more of a pause like a small congestion and so on). They look different depending on the buying or selling pressure I think.
A bounce at support or resistance is usually the same as an opportunity to enter at the break of a demand or supply line a few minutes later and I do not (for now anyway) have any specific rules for them.
So to answer the question: I know there is a long to be had when price continues up and then makes a retrace that will allow me to enter. It already tested 3659 and is going up but then again, come Tuesday it may look different.
Ditto. What exactly will you be on the lookout for? What are your criteria for determining (a) whether or not there is a short to be had and (b) how to get it?
Right now the answer would be the same as above (but for a short).
What is on the left? What are the upper and lower limits of the range? What is the mean? What behavior can you anticipate at the limits and at the mean?
If I look to the left I see what I did try to illustrate (badly, I guess). There is a 20 point range with a mean of ~49. The range ended with something that might be a hinge (I don't have enough experience to classify it as such; it might be chop) with a mean of ~53. Upper limit of the range is 59 and lower limit is 38. If price returns into this range I am anticipating some hesistance at the upper limit, then a move down that gradually slows until we reach the mean. There might be some temporary back-and-forth movement at the mean of the could-be hinge at 53 along the way. Since price has spent much time in this range before I anticipate most "action" to be slow or grinding. A short entry would be at the upper limit (using one of my three defined entry rules). I would avoid entering in any direction close to the mean (but I do not yet have statistics on these "pictures").
I have not mentioned exits. Right now they are at the break of the demand or supply line. I've just started to investigate strategies for scaling out.
Thank you for taking your time and for the questions.
