Stumped on this trade

Taylor
TPT Team
Posts: 52
Joined: Tue Oct 25, 2022 7:29 pm

Re: Stumped on this trade

Post by Taylor »

Hey Raymond,
From my perspective, price movement has a 'noise' aspect that can cause quick, unpredictable spikes that sometimes can be less important that the consensus level. So from that aspect, we can sometimes use the open and close of a bar to find what may be more of a 'consensus' price level. Seeing that the body of the bar (which is determined by the open and close) is entirely below the high of the intact micro up trend, this still looks like a leg of correction from my perspective. Therefore, this could be considered 2 legs of correction and a hidden 2EL. However, all of that aside, this micro uptrend looks like a fairly strong impulse move and if you remember from the PALs, strong impulse moves often correct around 50% before retesting the extreme of the impulse move. This can be especially true if that 50% correction area occurs at the ema and critical support/resistance areas with great local PA (setup bars, signal bars, no congestion, etc.). Hope this helps!
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