The question was concerning why not enter on candle # 3. In this example the TDI indicates taking the trade on candle # 1. Had you entered on candle # 3 you would have been two candles late for the CORRECT ENTRY. Because a reversal normall runs 3-8 candles we were fortunate it has run so many candles... The idea about entering on candle 1 or 2 if you get the TDI signal is if it only goes 3 candles you should get on average at least some profit... especially on higher time frames. {image}
Folks,
It's weekend time and when I was a newbie trader, I spent most of my weekend free time reading and studying Big E posts and his training chart.
This trading chart in the post#142 is one which I made comments and learn to apply price action and support/resistance and also to see consolidation using the price bars with the HA candles.
my conclusions are -
1) we do not need to enter a reversal in HA candles 1 and 2. We can enter the new trend after the reversal and the new trend is established. We see the new trend by looking at the the price action ( both the price bar and the HA candles and the TDI Green over the Red. Notice the space between the Green line and the Red line. If you enter a reversal using HA candles 1 and 2 and there is resistance above, your trade will be more risky. You need to mitigate those risks.
2) observe the strength of the price trend when it move to above the OverBought OB levels, both on the Stochastics and the RSI(TDI). Reading the price action will help you decide to stay in the trade even when the HA candles are in the OB regions.
Note: The member Mehdi is right with his Method_1. He obviously is one who had spent a lot of his time studying his charts and came up with his methods following Big E posts.
3) Do yourself a favour, make sure you have the 5EMA, Typical Price, Shift+3 on your charts. Use that to decide on the setup candle. The setup candle is the HA candle which closes above the 5EMA for Buy and close below for Sell. Use the TDI Yellow line as Big E had recommended and if that give you more confidence to trade.
4) You can also consider to use the original Price Action Channel. Using the two 5 Smoothed MA, one set to High price and the other set to Low price. This should help you pick better trades when the PA is above or below the PAC. Use the opposite side of the PAC as your trailing stop distance.
Spend your time to read and study Big E's posts/training chart. Make sure you write your own notes. When you read his posts replying to another members post/questions/charts, you must also read the members posts/question/chart. When you pay more attention to these, you will learn that there are are some discretionary decisions and not just blindly following the basic entry and exit rules like in Post#6.
Have a good weekend.
Honesty is a very expensive gift. You wont find it in cheap people.WBuffett
