by eric-pal » Sat Apr 08, 2023 11:26 am
Thank you for the great question. There are a few subtleties and nuances that can make this game very difficult.
CONSIDER THAT THE BARS ARE AN OUTPUT OF A BALANCING PROCESS BETWEEN OPPOSING SIDES. YOU ARE NOT TRADING THE BARS BUT THE PROCESS.
One of the first misconstructions is that you are going to feel comfortable doing this. That is a logic error. Sorry. You are not going to feel comfortable at all, and for quite some time. Here is where a lot of psychological development nonsense contrasts real skill development. When dealing with high probability you want to be right and should be right. So if one is wrong - well that feels bad. Then one doesn't want to feel bad so one doesn't trade because they want to feel "right".
So, where does an individual "jump the track", so to say, and slow down their development? By trading too soon before skill development and trading live, trying to prove to themselves that something works. In fact, by working in this method I can assure you that years of frustration will occur.
So first rule, don't trade at all. Nothing. Watch using the vision drills and enjoy seeing how the market moves first. Many are surprised that what they think they see on a chart isn't what is really happening. Case and point, there is a rule, especially for beginners that says don't make a decision until a bar completes. Why is this? Because the important variables are not necessarily set until that event duration happens. Watching bars build for the entire event is very, very, very, important.
Next, please review the logic order of channels and their effect with the ema. There is a logical order of operations and one of the first aspects is - how strong is the initial move? Very important because if it is very strong, it will be supported by the ema. This creates a slightly different situation than if the ema isn't supportive (channels only).
What is highlighted isn't a channel and a break to a new high, but a micro channel break. A channel break includes the 1st correction. The first drawn line is a microchannel. When you make that update you will find that the channel actually has not been retested yet. For the microchannel note it strength. Review how much each bar retraces into the previous. What is this telling you? The 4th bar is a potential exhaustion bar and the largest. Oftentimes that is where prices will stall, form a lower high, but that isn't a reason to take a short. When have the shorts been winning this game?
You have to note the breakout strength, and where the targets are, the top of that breakout. The pullback doesn't even come close. There are 6 bars in the pullback to the ema. 3 bear bars, 2 stalling bars, and then the bears really attempt to test the breakout, right at the ema. Finishing that bar on its low. Then the attempt to close the gap and - - - what the heck - THAT IS REJECTION (and a trap), right at the ema. Visually, if you see this happen you will note good rejection (momentum). Did you note the next bar had 0 retracement into the bull bar - yeah they are shooting for the retest here and a limit order didn't work. Stop orders in very strong markets are the key.
Please reread the above aspects again as they involve reading strength of market through structures, tests and momentum. Potential traps and how the market is moving. When you go back to reviewing the market again, you may find yourself enjoying watching the market move more for these type of subtleties.
The next time prices pull back to the ema is much less decisive and the PA results in having to make a decision at the high breakout area. However, the ema support confirmation has been verified and when the ema is next tested, we still expect a retest. Note that movement later in the day as the last breakout retest is attempted. It is a long drawn out move. However, note the similar aspects in the next test to the 1st ema test I described.
There is a lot of material in the 4s section
.
Consider that the bars are an output of a balancing process between opposing sides. You are not trading the bars, but THE PROCESS. Note, with high probability, the bars describing the process will appear very, very, very similar. When will most "feel comfortable"? Well when that process is over and balanced -> when there isn't an edge. Comfort. . .
Thank you for asking a great question and hopefully helpful.
Good trades to you!
Thank you for the great question. There are a few subtleties and nuances that can make this game very difficult.
[b][color=#4000FF]CONSIDER THAT THE BARS ARE AN OUTPUT OF A BALANCING PROCESS BETWEEN OPPOSING SIDES. YOU ARE NOT TRADING THE BARS BUT THE PROCESS.
[/color][/b]
One of the first misconstructions is that you are going to feel comfortable doing this. That is a logic error. Sorry. You are not going to feel comfortable at all, and for quite some time. Here is where a lot of psychological development nonsense contrasts real skill development. When dealing with high probability you want to be right and should be right. So if one is wrong - well that feels bad. Then one doesn't want to feel bad so one doesn't trade because they want to feel "right".
So, where does an individual "jump the track", so to say, and slow down their development? By trading too soon before skill development and trading live, trying to prove to themselves that something works. In fact, by working in this method I can assure you that years of frustration will occur.
So first rule, don't trade at all. Nothing. Watch using the vision drills and enjoy seeing how the market moves first. Many are surprised that what they think they see on a chart isn't what is really happening. Case and point, there is a rule, especially for beginners that says don't make a decision until a bar completes. Why is this? Because the important variables are not necessarily set until that event duration happens. Watching bars build for the entire event is very, very, very, important.
Next, please review the logic order of channels and their effect with the ema. There is a logical order of operations and one of the first aspects is - how strong is the initial move? Very important because if it is very strong, it will be supported by the ema. This creates a slightly different situation than if the ema isn't supportive (channels only).
What is highlighted isn't a channel and a break to a new high, but a micro channel break. A channel break includes the 1st correction. The first drawn line is a microchannel. When you make that update you will find that the channel actually has not been retested yet. For the microchannel note it strength. Review how much each bar retraces into the previous. What is this telling you? The 4th bar is a potential exhaustion bar and the largest. Oftentimes that is where prices will stall, form a lower high, but that isn't a reason to take a short. When have the shorts been winning this game?
You have to note the breakout strength, and where the targets are, the top of that breakout. The pullback doesn't even come close. There are 6 bars in the pullback to the ema. 3 bear bars, 2 stalling bars, and then the bears really attempt to test the breakout, right at the ema. Finishing that bar on its low. Then the attempt to close the gap and - - - what the heck - THAT IS REJECTION (and a trap), right at the ema. Visually, if you see this happen you will note good rejection (momentum). Did you note the next bar had 0 retracement into the bull bar - yeah they are shooting for the retest here and a limit order didn't work. Stop orders in very strong markets are the key.
Please reread the above aspects again as they involve reading strength of market through structures, tests and momentum. Potential traps and how the market is moving. When you go back to reviewing the market again, you may find yourself enjoying watching the market move more for these type of subtleties.
The next time prices pull back to the ema is much less decisive and the PA results in having to make a decision at the high breakout area. However, the ema support confirmation has been verified and when the ema is next tested, we still expect a retest. Note that movement later in the day as the last breakout retest is attempted. It is a long drawn out move. However, note the similar aspects in the next test to the 1st ema test I described.
There is a lot of material in the 4s section :).
[b][u][color=#0000FF][color=#4000FF]Consider that the bars are an output of a balancing process between opposing sides. You are not trading the bars, but THE PROCESS. [/color][/color] Note, with high probability, the bars describing the process will appear very, very, very similar.[/u][/b] When will most "feel comfortable"? Well when that process is over and balanced -> when there isn't an edge. Comfort. . .
Thank you for asking a great question and hopefully helpful.
Good trades to you!
