A â Price had been in a tight range the preceding few hours, so Iâm looking for trade out of it. At A, we has a DL and one point above here would just barely take us out of it. Seeing as we are close to open as well, Iâm of the impression that getting in before the open works out often as the move just continues. If not, its easy to just scratch. Here the DL is broken, so the trade is cancelled and doesnât trigger.
B â Price shoots up here, had the long trigger been kept, it probably wouldnât have been filled anyway. In RT, this was quite the move. My broker even said trading in the NQ was halted, but price is clearly moving⦠hmmmm. It appears now that it was halted for the previous contract.
C â As a result of all the commotion, this would be a good area for a sell stop. We have a SL, a RET here, but this also puts us right back into that mini range from before open. Everyday though I am seeing that its just important to get in when you see a valid setup.
D â So watching this down move, I am eager to get in. Since we broke below 3700, going down looks promising, but there is no way to get in. On the lower time frame chart, there would be a clear RET here. I am very good at watching the right tick and see this setting up. But because it takes a whole minute for the bar to âcloseâ, the low of each bar around D still goes below the previous bar so there is technically no RET on this one minute chart. I wonder if this rule for SLA can be altered, but this would of course require testing. I have talked about this before and have seen that doing this will sometimes put me in a trade for a move that is just about done. the question of course is does getting in early like this lead more often to a winning trade or not.
E â First official RET happens here. Sell stop at 95.25
F â SL is broken here but Iâm staying in. Iâm aware of the many times price just pauses, only to continue the initial move. Here it turns out to be the case again and the SL is fanned. (or rather, new SL is drawn in from previous swing highs. By fanning the line, I have read Db say that if price is too far away from SL or DL, then it really isnât following price anymore, and thats its job. So what I mean to say is that its important for the line to follow price. So if fanning it still makes it too far away, I'm inclined to just draw in a new one with the most recent swing points.
G â Looks like another RET, but now we have a micro higher low.
H - SL break, another higher low, so out at 69.50. Total at +25.75. This is a shame though because now of course I got out at the top of this RET, only to see price continue down. In RT though, it certainly appeared that the down move was done.
I â Thinking of how to get back in. I could just fan the SL or draw in a new one, but I am a bit worried about forming a DB with 61.50 just before G. Each of the next few bars seem to show this as a bit of resistance so Iâm just going to wait and see.
J â So I see another RET and opportunity to get in, so I take it and get filled most likely at 59.75.
K - Doesnât take long for price to strongly move up, but I still hesitate to scratch. Price strongly drops on the bar at K, but doesnât follow through too much so Iâm looking to exit. Decide to get out at 61.75. Total now is +23.75.
I donât have a scratching technique per se. I look to see how strong the break of a SL or DL is, how many bars are broken, and is the break going in the opposite direction of my trade or is it just going sideways. In this example, I held on for too long after my short was filled, and I got out almost even before a solid break of my SL. So in essence I am going against what I would naturally think, but the movement of the right tick caused me to hesitate. It looks to have worked for me this time.
L â Strong break of the SL here. This is the kind of break I like where price just pierces the line cleanly and doesnât return to touch it.
M â So here is the RET after the break, but the move already looks like its rolling over to be flat sideways action so I hesitate to put in a buystop. I donât even draw in a DL yet since I donât have a swing low to connect.
N â I can now draw in my DL. Iâm hesitant to take a trade above this N bar. We have a RET the bar before, and my buy stop would be at 3672, but the bar before this RET bar shows a strong rejection of price at 72.
O â By now of course this trade would have been a few points positive⦠oh well.
P â Slight break of the DL line, but would still be watching and waitingâ¦
Q â Still looking good, price breaks back above the DL.
R â So now the break has gone on for too long. Might as well take a point of two of profit and get out. But none of this was actually taken, so just thinking through it.
So thatâs it. Looking at the entire chart now its not as clear because the chart is quite compressed given the strong down move. In RT, as the lines were being drawn in, each move looks a bit more prominent. I leave my SLs and DLs as is just to show what was happening at the time, and even though a line can be fanned, I prefer to just draw in another one to give a sense of what is happening in RT.
Well great that I can read it now when I have time.