Quote from TraderD72:
This has been my focus this entire past week. (review some of my prior posts)
I was often identifying my point 3 area too soon.
psychologically I didn't ant to miss the move but on the flip side I was uneasy with price moving against my entry area too much.
As a consequence price would then move against me by a few ticks or points.
After reviewing numerous charts I concluded that most of my emphasis was on the price bars themselves instead of a "complete data set" (price, volume, context, etc).
For example, at the start of an UP TREND, I would see the non dominant traverse and I would eagerly await the arrival of my point 3 area. Then the first GREEN bar I would see I would often mark this as my point 3 when it broke the "tape".
Next thing I knew price would move stall and move sideways or, even worse, it would move down a few ticks or points. I would then think I was wrong and say to myself that if I was in this position I would look to exit.
Then, of course, we put in the "real" point 3 and head straight up.
So now I not only wait for the tape to break but ,most importantly, wait for volume (or PRV) to be above the previous Volume bar and price (most times) to break the previous price bar high/low. ( this sounds SO basic but I wasnt doing it)
On the times that I did enter early this past week if price would stall I would immediately look to volume.
If it was going sideways or slightly against me on LOW VOLUME I was MUCH more confident in "fanning out" my channel as opposed to thinking EXIT.
I also realized that often times the PRICE BAR we mark as a point 3 is NOT neccesailly the price bar we would use to enter a position.
The price point could have established a higher low (in a UP channel) ,so to speak, but the volume has yet to arrive to drive price in the dominant direction.
Whew! Sorry for the long post but I was very frustrated with point 3's identification as well so I hope this helps in some small way.
As always comments or correction is welcome!
