DislikedHi guys, Mike and Ghous i will like to get more information on the following: Why do we look for big Candle PA to appear b4 we take trades as opposed to catching the beginning of the 100-120 point move of the PA candle. Could it be that we are looking for a sign indicating a lot of traders/volume participating in the trade at the most recent moment i.e. a tip off from the market which could eventually draw the attention of more trader's willing to participate which could probably create a continuity in the order flow imbalance to further push the...Ignored
There is a variation of trading PA where you try and get at the source of the action by taking a "blind" or a "touch" trade. Its called so because you're anticipating a bounce there without seeing any PA bar to add to the story. Its advantageous because it helps you get in at a better price but the demerits include its aggressive nature which means a lower strike rate. You need a system that will find itself on top despite taking multiple hits. Some people have ventured down this road and touch trade very successfully.
It depends really on what personally defines you as a trader and whether you would want to wait for a clear direction through a PA bar or try and anticipate it before it comes and in turn accept the added risk that you're taking on in doing that.
The reason behind waiting for your big strong PA bars to close before placing orders is of course, that we are waiting for that tip off in our favor. Yes that gets you at a poorer price than if you had touch traded but it really is the "cost of acquiring that additional information".
In the end neither is cooler or better or more effective than the other. What makes a method work or not work for you is simply dependent on whether your attitude and your mindset allows you to adjust and adapt.
g.
I believe . . .