If you grab any decent charting book and learn what you are looking at would help, chart is a descending triangle, and you would understand the stats of which way most likely price aiming to go, so based on what there is, stats say most likely to break lows, so draw downsloping trendline off the highs, when price rallies and hits TL, go short and risk? Where your back testing comes in, you hang on waiting to see if break low, other wise at some point lock in a tick or two. Downsloping TL of highs when you know by your definition trend is down, upsloping TL on lows when your definition of trend is up. Here is your book right here.
Trading Ranges, Support, and Resistance
- Thread starter SimpleMeLike
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If you grab any decent charting book and learn what you are looking at would help, chart is a descending triangle, and you would understand the stats of which way most likely price aiming to go, so based on what there is, stats say most likely to break lows, so draw downsloping trendline off the highs, when price rallies and hits TL, go short and risk? Where your back testing comes in, you hang on waiting to see if break low, other wise at some point lock in a tick or two. Downsloping TL of highs when you know by your definition trend is down, upsloping TL on lows when your definition of trend is up. Here is your book right here.
Thanks for the book Handle123.
You summed exactly what I been practicing except I never bought or sold off a trendline (TL). I will now. I do clearly see the trendlines and they are powerful. It appears many traders trade off these TL.
Yes, you should! I love your question because you already answered it. This is how it's done. You just have to have the balls to do it. Don't back test, front test. Buy and sell EVERY level you determine to be support and resistance with the smallest size possible and see how you do. NEVER make an exception to this rule. You are going to be an S/R trader, so you must buy and sell S/R!!
You will be pleasantly surprised...it works most of the time. Keep it simple, just like your username. Once you get comfortable with placing these orders, slowly develop rules based on chart action for when you will NOT make these trades. For example, volume was too high, the range of that bar was too big, etc. Once you have a profitable strategy, slowly increase your size.
-Alex
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A very long book Trading Price Action Bar by Bar written by Al Brooks.
I tried to read it several times but did not get beyond few pages. It is kind of very intense read.
Support and Resistance trading can be profitable if you get a hang of it i.e. when will the level hold and when will the prices blast through them.
I tried to read it several times but did not get beyond few pages. It is kind of very intense read.
Support and Resistance trading can be profitable if you get a hang of it i.e. when will the level hold and when will the prices blast through them.
Thank you so much aldrums. Very insightful and interesting. I will do this.
Good luck. One caveat, I don't know what market you trade, but you need to find one where S/R is apparent, whatever timeframe you are on. If it's a raging bull market, just buy support. Opposite for a bear market.
Hello galvinlee888,
Yes, I have last week during demo practice. Thank and I will.
You have missed the most important part of breakout/breakdown trading---The second mouse gets the cheese.