DislikedA quick note on timeframes:
I make my entry decisions on a 4H TF. I use the daily and weekly for areas of S/R and overall tend analysis. I never enter a trade based on anything below a 4H chart. In my opinion decisions made on anything lower than 4H charts are for individuals who are looking to get in and out of the market the same day. Otherwise known as day traders.
Ok now that I got that out of the way…
Up until now we have been talking about using price action and how o use it to get into the market. It is no big secret that making trades in the direction of the primary trend presents a trade opportunity with the highest probability. So the question is going to come anytime now about how do we determine the trend? What time frame is most reliable and so on and so forth?
Let me make this clear to anyone who reads this. Lower timeframes build the trends we see on the higher timeframes. So a 1H feeds a 4H which feeds a Daily which feeds a Weekly which feeds a Monthly. So knowing this allows us to use this to our advantage to catch the intermediate or minor trends based on price action of lower timeframes.
What this also means is that one mans up trend is another mans down trend hence the difference in opinions about the market which cause price to go up and down.
There is no right or wrong only a difference in opinion about where the market is heading.
So do your analysis make your choices and stand by them. If you get stopped out on a trade don’t let it affect your mentality about your ability to trade. You will have losing days it’s part of the business and that’s the way it is. There is not a business that I know of that hinges its success on its daily profits and losses rather it bases its profits over the longer time frame.
If you do not know how to determine the trend direction on your given TF then my suggestion to you would be to stop trading immediately and do some research! Not trying to be mean just trying to save you some aggravation.
So what does all this mumbo jumbo mean anyway? Well for KevTCW it means that the points that you have indicated on the chart you provided are areas that “I” would look at and trade on based on a violation of those areas. This may not be the same for everyone who looks at it. Someone else may interpret it differently and enter a short position at the Black number 2. This is where Feb would most likely enter a trade. I on the other hand am a bit more conservative with my entries and prefer to look for a breakout. Let me caveat this by saying I do enter trades as Feb does but based on specific criteria I will touch on at a later time.
For now lets keep things moving in the right direction by understanding that we are looking to enter trades in the direction of the trend with an entry point based on a price action setup after a pullback or a break of he most recent #2 point after a pullback for you more conservative types like myself.
Still more to come.
Trader_VIgnored
Thank you for taking time to reply. Its great stuff to me.
As I am a newbie, I still got much to learn. Thanks.
kevtcw