Disliked{quote} Hi Emmanuel, how do we tell exactly when the market is in range consolidation or trending?Ignored
As technical traders we cannot tell exactly when the market will be trending or when it will be in consolidation.
What we need and is very important is to follow a consistent top down analysis approach in determining the market type in which we trade.
Top down analysis start from the use of the Monthly chart to look at the historical price swing levels. Look at MN Line Chart.
The next thing which I do is to look at Price Bar patterns (or Japanese Candlesticks patterns) and also the Chart Patterns like Double Tops, Triple Tops, Head and Shoulders type of chart patterns.
In using Price Bar patterns, we can easily see the 'big' and 'small' candles, which will help determine if and when the market is trending or in consolidation.
Sideways market have two types - the wide range and narrow range. The wide range market type is good to trade with TMS just like the trending market type.
The winning edge in becoming a consistent profitable trader over a long term is a combination of things. One is the money management strategy. The trading method is a very small component of a winning strategy. Having a consistent approach in defining the market type and knowing the market type to trade is very important. The biggest component of a winning edge is the mental fitness of the trader.
regards,
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett