Son of If You Can Draw a Straight Line . . .
- Thread starter dbphoenix
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. I am going to stick to friday until told otherwise. 
.Well, to give an honest answer, I oscillate between being too quick on the draw and succumbing to analysis paralysis when I am trying to look for theoretical entries.
If I place myself in this situation, I would feel some pressure to do something like place a buy stop above 3196 to catch the opening surge if it goes in that direction.
However, if I were trading, at this stage I would probably keep watching, expecting a relatively powerful up-move to begin as the opening transactions flood in, and look to enter long on the next retracement from there.
Since it looks like there is some pretty dedicated buying pressure here, I would be more liberal with my retracement entry, expecting the possibility that the first RET might only be a short-duration 10-20% pullback before the movement continues.
Placing a buystop above 3196 at the open is a non-starter as it would not be filled, or at least it would not be filled unless price revisits that level to the downside, which is not what you want.
In the series of posts I made Friday, the next was "0936: Price has exceeded the last swing high. What does one do now?" And this is the accompanying chart:
What is price telling you here about the demand/supply equation?
What are you going to do about it?
And I hope that the value of looking at these timeframes in "real time" as opposed to a hindsight view of an entire day makes the worth of replay clear. One cannot trade -- or evaluate -- what one cannot see.
Oh, my mistake. I was working off this definition:
Definition of 'Buy Stop Order'
An order to buy a security which is entered at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.
Perhaps there is a difference in terminology between trading platforms or something.
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However, in the course of this exercise I would now be in the trade at 3197, having waited for the next minor RET and placed a buy order at one point above the top of the bar. I would be looking for a break in the purple demand line for an exit, but have noted that demand has increased even more sharply over the past few minutes with my blue line.
In the case that I had multiple contracts active, I would look to begin scaling them out as the buying pressure begins to taper off to a more realistic level, starting with the break of the blue line.
Definition of 'Buy Stop Order'
An order to buy a security which is entered at a price above the current offering price. It is triggered when the market price touches or goes through the buy stop price.
Perhaps there is a difference in terminology between trading platforms or something.
--
However, in the course of this exercise I would now be in the trade at 3197, having waited for the next minor RET and placed a buy order at one point above the top of the bar. I would be looking for a break in the purple demand line for an exit, but have noted that demand has increased even more sharply over the past few minutes with my blue line.
In the case that I had multiple contracts active, I would look to begin scaling them out as the buying pressure begins to taper off to a more realistic level, starting with the break of the blue line.
The "buystop" is actually a buystoplimit, unless you want to be filled at a price considerably higher than what you intended. But that's your choice.
Nonetheless, whether your order is filled or not, what is the last chart I posted telling you about the demand/supply balance and about what the next step in your course of action should be?
Not necessarily "again". Placing any kind order at the open is not a wise move. If one did so anyway and it wasn't filled, then, yes, an attempt to place buystoplimit order "again" would be appropriate, particularly with the added confirmation of the breach of the last swing high, as below:
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