What do you look for when entering trades?

When you consider entering a trade what are you looking to enter into?

Breakouts? Reversals? Retracements? Continuing trends?

On of my preferred ways of entering a trend is first to identify a trend that exists per overall price action (opa) - peak/valley analysis on a t/f and preferably for that trend to exist on the next higher t/f (by a factor of x 4 to 5) +

I then identify the potential support becomes resistance [sbr] and resistance becomes support [rbs] areas on that trending t/f, ie previous fractal swing lo or hi's that price has breeched to the downside/upside respectively in such an opa down/up trend. I add to this any relevant fibs and trend lines,

I am then looking to get 'with the trend' by looking for a hidden divergence based play on the t/f below at such potential sbr/resistance in the next higher t/f downtrend -or- potential rbs/support in the next higher t/f uptrend after a pullback to it.

An eg is below where there is a pullback in a 15min opa uptrend to a previous swing hi on that t/f (previous resistance) - confluence with the 38.2% fib of the last swing up on that t/f (a-b.) When price tests this previous resistance zone in a pullback after breeching it to the upside- a 3min hidden divergence play develops to get back with the 15min uptrend after the pullback.

This is just one way of getting ' with trend ' - I am sure others will have other ways.

G/L

Cheers bmac. So far my pretrading analysis goes; chart structure (trending or ranging), identify S/R and PA, identify patterns & set-ups, intermarket & correlated market analysis (need work on this) and overall sentiment based on news.

Tyoon, you are definitely making all of the right noises. For me identifying the market condition, finding the trend and then looking for the support and resistance are the most important points before entering a trade. Once you have this it is simply looking for your signal.

I trade a swing trading approach on a very short term range chart. So I look for all of the above then I look for momentum and look to jump in when the market starts to move in the direction of the trend. This could be a break out of consolidation, trend line or even a 1-2-3 reversal but ultimately I refuse to trade against the trend unless I am at a very strong level.

hy tyoon..
i've a question..

how do you determine which one is base and which one is reaction..
1.on number 2 in yellow box, can we determine it as a new base?
2.on blue box and lime box.. it is a base too? still can determine the right base..

I look for only one thing. Indications of greed. Desire for gain.

That's really it. If I see indications that price is rising because people are getting greedy in a long direction....I jump in. I then set a particular profit target and get out. I don't get greedy as well once I'm in. Same thing when I see people getting greedy to go short.

I heard someone refer to it as "train jumping" or "momentum trading". The goal is to get on as soon as you see the train already leaving the station and get out before it comes to a complete stop.

What is your indicator? thanks

This is a very old thread, I had totally forgotten about it.

1. that is a reaction (but also a small base on a lower TF).

2. if you are thinking in terms if supply and demand, those are not the kind of bases you want to be looking for.

Bases derive from H/Ls and S/Rs. Start there and build the picture from that.

I think breakouts and price traps based on trend lines with a reasonable profit without lusting is the worth and most effective method..... what ever fundementals
but keep in mind that the big enemy of this system is SPIKES
trade well and good luck
PLAN YOUR TRADE THEN TRADE YOUR PLAN

Mine is :

1- Break previous support/resist line with candle close below/above it
2- Another candle close below/above previous candles
3- Enter trade