Captain Pugwash wrote:
Thanks MO, I feel I have to ask a question now!
That is an Interesting chart as I would only be looking for a place to short
Am I looking at this correctly
If this was and H1 chart you would be looking at both L and S- from a body over and fail to close under breakout for a long and a body over and a wick failing to close back under the previous midpoint?
And for a long I would be looking to be aware of a possibe exit at one of those two higher levels
really sorry for being so thick
I seem to have missed the midpoiint thingy entirely
- or is it just a handly place to draw your line in the same place, consistently?
The only thing that is "correct" is the idea:
Bodies show the way, wicks show not the way; price cannot rise on wicks, neither can it fall without closing lower.
In the short-term price can cross lines like a teenager, but in the long-term price must both pick a direction and choose
not to return to its old ways (re-cross & close). The midpoint starts off as the open price
and is left behind as the ranges expand further and further over time.
If you know which way the market will move then the extreme is the best price to trade from, but if you do not
know then trading from the midpoint is best.
The extreme (in the direction of profit) or previous anything is used when I want to trade in a certain direction but my stop is out of reach (as in the BOx trade).
Maybe if I were short I would hold short but since I am flat I'll try to go long as price rises above the median...
if the impact to your account is small then take more stabs and if it is great then take fewer stabs.