I only had time this morning for a quick 1 point scalp. I had to travel to another town and from there do a several hour video conference. But this trade shows a nested pattern I talk about above so I am posting it for consideration.
First larger context. Gap up open then trading range behavior for about 20 bars or then price heads south from top of the range in a bear trend within the range that led to a BO out of the bottom of the range. That was followed by a PB. That is when the channel can be draw in. Once you have a trend then a PB you can start drawing a channel. Actually on the 10:00 bar down in the bear trend you could start drawing a channel as that bar was a PB. certainly draw the channel in by bar 10:30
In channels the concept is price will meandering back and forth. Usually there will be price patterns nested within the channel. Depending on the broadness of the channel these may be larger patterns or micro patterns. A channel is a tilted range. In bear channels the odds for probability favor selling or shorting near the top as opposed to going long at the bottom. However, a trader can do both is the channel is broad enough to render 1 to 8 points in the ES, I am speaking.
In this case we see a nested triangle (blue lines) within the channel (orange lines). Triangles are BO mode. Sooner or later price will BO north or south but BO it will. In this case, the apex is at the top of the channel giving greater odds that the BO of the triangle will be south since it is a bear channel. I missed the trade south on the BO (I forget what I was doing at the time...I think I was getting my carcass awake...as I was up late last night) but I did take the trade up from the bottom of the channel. I saw I could grab a quick 1 point scalp as price usually will go back and test the apex of the triangle. So, I grabbed my point and quit trading as I had to leave for a video conference in another town.
But see the patterns. See the context, larger and immediate. See the nested patterns. These are multiple opportunities for 1 to 8 point scalps. Remember, a trader doesn't have to capture lots of points to make good in trading. If a trader can just become consistent reading and trading PA, and can just capture 1 to 3 points of the day he can make a lot of money just by upping the size of the position. Of course that depends on the size of one's account. You don't have to capture the larger move of the day. A trader can capture multiple small moves, with size, and then go fishing or golfing, or whatever, while another trader is getting bored waiting for the larger daily moves to come about.
If I didn't need to travel out of town I would have entered right back again long on the very next bar and captured an even bigger move.
Small captures can add up. Five ES contracts capturing 3 points, plus 5 contracts capturing 2 points, plus 5 contracts capturing 1 point. That comes to 3 trades for the session. That means 750.00 + 500.00 + 300 = 1550.00. Now translate that into yearly. It isn't that hard to capture 6 points in the ES just in the morning part of the session.
NOTE: The triangle is basically a bear flag. It is a PB in the form of a bear flag in a bear trend. To see the bear trend better dial down to a smaller TF. The bear trend on the 5 min chart is from bar 9:45 to bar 10:10. On a smaller time frame like 2 min the bear trend is a two legged bear move. See second my second chart, an excerpt chart with yellow arrows, showing same triangle.... same entry and exit. SO...…..
Remember, every bear bar is a bear trend on another TF. Every bull bar is a bull trend on another TF.
First larger context. Gap up open then trading range behavior for about 20 bars or then price heads south from top of the range in a bear trend within the range that led to a BO out of the bottom of the range. That was followed by a PB. That is when the channel can be draw in. Once you have a trend then a PB you can start drawing a channel. Actually on the 10:00 bar down in the bear trend you could start drawing a channel as that bar was a PB. certainly draw the channel in by bar 10:30
In channels the concept is price will meandering back and forth. Usually there will be price patterns nested within the channel. Depending on the broadness of the channel these may be larger patterns or micro patterns. A channel is a tilted range. In bear channels the odds for probability favor selling or shorting near the top as opposed to going long at the bottom. However, a trader can do both is the channel is broad enough to render 1 to 8 points in the ES, I am speaking.
In this case we see a nested triangle (blue lines) within the channel (orange lines). Triangles are BO mode. Sooner or later price will BO north or south but BO it will. In this case, the apex is at the top of the channel giving greater odds that the BO of the triangle will be south since it is a bear channel. I missed the trade south on the BO (I forget what I was doing at the time...I think I was getting my carcass awake...as I was up late last night) but I did take the trade up from the bottom of the channel. I saw I could grab a quick 1 point scalp as price usually will go back and test the apex of the triangle. So, I grabbed my point and quit trading as I had to leave for a video conference in another town.
But see the patterns. See the context, larger and immediate. See the nested patterns. These are multiple opportunities for 1 to 8 point scalps. Remember, a trader doesn't have to capture lots of points to make good in trading. If a trader can just become consistent reading and trading PA, and can just capture 1 to 3 points of the day he can make a lot of money just by upping the size of the position. Of course that depends on the size of one's account. You don't have to capture the larger move of the day. A trader can capture multiple small moves, with size, and then go fishing or golfing, or whatever, while another trader is getting bored waiting for the larger daily moves to come about.
If I didn't need to travel out of town I would have entered right back again long on the very next bar and captured an even bigger move.
Small captures can add up. Five ES contracts capturing 3 points, plus 5 contracts capturing 2 points, plus 5 contracts capturing 1 point. That comes to 3 trades for the session. That means 750.00 + 500.00 + 300 = 1550.00. Now translate that into yearly. It isn't that hard to capture 6 points in the ES just in the morning part of the session.
NOTE: The triangle is basically a bear flag. It is a PB in the form of a bear flag in a bear trend. To see the bear trend better dial down to a smaller TF. The bear trend on the 5 min chart is from bar 9:45 to bar 10:10. On a smaller time frame like 2 min the bear trend is a two legged bear move. See second my second chart, an excerpt chart with yellow arrows, showing same triangle.... same entry and exit. SO...…..
Remember, every bear bar is a bear trend on another TF. Every bull bar is a bull trend on another TF.
Last edited: