I think I've got a case of information overload, reading way too many analyst's outlooks. As a result I fear I may be losing site of some basics regarding how to enter a trade.
Regarding entry points, in most cases for an entry point for a short do you wait for a price to drop down to an entry target and buy at that target assuming the price will continue down through that target, OR, is it more "reliable" to waight for a price to go up through a high target price, then set your order for when the price drops back down to the target. I guess the only difference is one method you are already above the target, the other the price is below the target. Entry on long would be reverse, either a) wait for price to rise up to target and buy at that point assuming it keeps going, or b) wait for price to drop below a target and buy at the target when it reverses and retraces up.
My suspicion is, it depends on what the market is doing. I believe the statistic is that a pair is ranging 70% of the time and trending 30%? Past performance is not a reliable indicator though of future performance (although people that solely rely on technicals might argue against that.) So at any given time no one one really knows if a pair is about to break out of a range. But if it does, it is more likely to breakout and resume the previous direction of the trend.
But is the basic strategy on how to enter a trade essentially determined if you are trying to trade a swing within a range, or are trading a breakout (prefereably in the direction of the trend).
I'm probably making this more complicated than necessary. Seems to me, if the trend is long and the market is ranging, just draw some Bollinger bands and wait for the price to come near the lower band and then reverse and catch it on the upswing. Vice versa for a short trending market, wait for the price to come near the upper band and then reverse and catch it on the downswing.
Regarding entry points, in most cases for an entry point for a short do you wait for a price to drop down to an entry target and buy at that target assuming the price will continue down through that target, OR, is it more "reliable" to waight for a price to go up through a high target price, then set your order for when the price drops back down to the target. I guess the only difference is one method you are already above the target, the other the price is below the target. Entry on long would be reverse, either a) wait for price to rise up to target and buy at that point assuming it keeps going, or b) wait for price to drop below a target and buy at the target when it reverses and retraces up.
My suspicion is, it depends on what the market is doing. I believe the statistic is that a pair is ranging 70% of the time and trending 30%? Past performance is not a reliable indicator though of future performance (although people that solely rely on technicals might argue against that.) So at any given time no one one really knows if a pair is about to break out of a range. But if it does, it is more likely to breakout and resume the previous direction of the trend.
But is the basic strategy on how to enter a trade essentially determined if you are trying to trade a swing within a range, or are trading a breakout (prefereably in the direction of the trend).
I'm probably making this more complicated than necessary. Seems to me, if the trend is long and the market is ranging, just draw some Bollinger bands and wait for the price to come near the lower band and then reverse and catch it on the upswing. Vice versa for a short trending market, wait for the price to come near the upper band and then reverse and catch it on the downswing.