tag:blogger.com,1999:blog-41798970634431254942024-03-05T07:55:32.763-05:00Sharpshorts Day Trading <b>..........TRADE for a LIVING, NOT a KILLING.............</b> <i>Conventional wisdom suggests that Trend Trading is reasonable and that picking reversals is a fool's game</i>
--- IMO the former task is more difficult---
<i><b>....REVERSALS RULE!</b></i> - Presented here are trade-able Price Action patterns that <b><i>CONSTANTLY REPEAT....</i></b>
<b>Take advantage of the patterns. They print on charts every day - In ANY market - On ANY time frame</b>.sharpshortshttp://www.blogger.com/profile/12207274525737796144noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-4179897063443125494.post-82346062976393980072012-12-04T13:27:00.017-05:002021-12-02T14:09:26.669-05:00......................Sharpshorts Day Trading (Home)...................... Introduction to My Methods......Recurring Patterns and Signals<div style="text-align: center;">
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<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: x-large; font-weight: normal;"><span style="font-family: "times new roman";"><div style="font-family: "";">
<b style="font-family: "";"><i>All investment exchanges are designed to separate you from your money.</i></b></div>
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<b style="font-family: "";"><i>Your broker is not your friend.</i></b></div>
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<b style="font-family: ""; font-size: x-large;">There are only two types of traders.</b></div>
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<b><span style="font-size: large;">I am a <i>Retail</i> Trader. </span></b><br />
<b><span style="font-size: large;">I have never been a <i>Professional</i> Trader.</span></b></div>
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<span style="font-size: large;"><b>I think you should understand the difference between them.</b></span><br /><b style="font-family: georgia, "times new roman", serif; font-size: x-large;">♦ ----------------------------------------------- ♦</b></div>
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<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: x-large; font-weight: normal;"><span style="font-family: "times new roman";">It's like </span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgmW1uyCMYVe4GmfdMX1qYE3sY2m0WcZ5LcCuTDpojVCAs3Qz1D_qzkxftXxUKud9pYw8MQBQouUXEQRvghPr-dAEH7XHKFJvUTpe1aMnMef2vpYquqkAWnDj8hiQI-z-wGBTYScXMTZCwa/s1600/Untitled+III.jpg" style="font-family: "Times New Roman";" target="_blank"><span style="color: cyan;">De`ja' Vu</span></a><span style="font-family: "times new roman";"> all over again...</span></span></span></h3>
<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">The events described on this blog continually repeat and can be seen on charts of any time frame or market.</span></span><br />
<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">Presented are ideas, explanations and definitions of the Price/Action events I have used for years.</span></span><br />
<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;"><b>Apply these ideas for initiating long positions.</b></span></span><br />
<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">These techniques can be used for scalping, swing trading or investing.</span><br />
<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;"> </span></span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">I offer simple methodologies to take advantage of recurring patterns and signals.</span><br />
<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">My main focus is "how to" scalp bits and pieces of price reversals at bottoms.</span><br /><br />
<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><span style="background-color: #274e13; color: #b6d7a8; font-family: Arial; font-size: xx-large;">"Trade with the established trend...Picking bottoms is a fool's game"</span><b><br /></b></span>
<span style="font-size: large;">Conventional wisdom suggests that this idea is the only 'truth' needed </span><br />
<span style="font-size: large;">to be </span><span style="font-size: large;">consistently successful </span><span style="font-size: large;">at </span><span style="font-size: large;">this game. </span><span style="font-size: large;">Embracing the conventional wisdom </span><br />
<span style="font-size: large;">may </span><span style="font-size: large;">seem to be the most logical </span><span style="font-size: large;">and the surest way to approach the markets...</span><br /><i style="color: yellow; font-size: x-large;"><b>BUT</b></i></div><div style="text-align: center;">
<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">Since most traders are not very successful at this vocation</span><br />
<i style="color: yellow; font-size: x-large;"><b>how valuable can the conventional wisdom be?</b></i><br />
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<i style="font-weight: normal;"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ ♦♦♦♦♦ ♦♦♦♦♦ </span></i><i style="font-family: "";"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ </span></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b> I. REVERSALS RULE !</b></i><br />
<i style="font-family: georgia, "times new roman", serif;"><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif; font-size: large;">Section 1 of 6 -- Some basic concepts - P/A + Divergence</span></i></i></i></div>
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<span style="font-family: ""; font-weight: normal;">My personal</span><span style="font-family: "";"> </span><span style="font-family: ""; font-weight: normal;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgU9qnYhFVMTVMzeYnYRDT9hEifI9ubvORoyjU-swEY_4V7or4xGeNJXArR1FgIwIJSQ5xQ4I6CXeNm6OgwsrczivJbR8td3i8-u49p9KYUPo9qK-Ay9J7X7lx1pZyPdjX7jWeQNIINxmMS/s1600/Bulls+Shopping.jpg" target="_blank">Technical Analysis bias</a></span><span style="font-family: "";"> </span><span style="font-family: ""; font-weight: normal;">is</span><span style="font-family: "";"> </span><span style="font-family: ""; font-weight: normal;">always pointing out</span><span style="font-family: "";"> </span><span style="font-family: ""; font-weight: normal;">bullish patterns</span><span style="font-family: "";">...</span></h2>
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<span style="font-family: ""; font-weight: normal;">Just call me</span><span style="font-family: "";"> </span><span style="font-family: ""; font-weight: normal;">a</span><span style="font-family: ""; font-weight: normal;"> </span><span style="font-family: "";">perma-bull </span><span style="font-family: ""; font-weight: normal;">- </span><span style="font-weight: normal;">This <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg2KAQG_fP5Atn-MXedd55F2ULbN5QTQJSzmeGNUryorZ2QQ8EFvNdXm7QJ1uYspG-skbDghKp891TNhpCkChin2Qda680GmjYR9jQ53EV8yYhnWeeKwGH9QVBsMd8dL3ffmRJ9r5niDdpP/s1600/DJI+3-28-18.png" target="_blank">chart link</a> shows a major reason why I am.</span></h2>
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<span style="font-weight: normal;">Repeating patterns print on ALL time frames - Monthly, daily or intra-day charts.</span></h2>
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<span style="font-family: ""; font-weight: normal;">I see bullish reversals as a matter of course. My basic premise is:</span><span style="font-family: ""; font-size: large; font-weight: normal;"> </span></h2>
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<span style="color: cyan; font-size: large;"><i style="font-weight: normal;"><b>In the markets, what goes down must go up.</b></i></span></div>
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YM Chart - 75 ticks per bar spanning about 3 1/2 hours of the early morning price action.<br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhyIeqi5XgWvK2US6n-iHhReXeIPfaJQTAJEcTLw4OgHfLWfaBe546QwzP761fb-HAe2jixCKvVG6XRB-nko4ss0MKBpRpr9tHTtvkQLoWsqCUmd9BJNRgAhPCtBHhe81iKPW42WrjzjQSk/s1600/ll_lh_hh_hl.jpg" style="margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="640" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhyIeqi5XgWvK2US6n-iHhReXeIPfaJQTAJEcTLw4OgHfLWfaBe546QwzP761fb-HAe2jixCKvVG6XRB-nko4ss0MKBpRpr9tHTtvkQLoWsqCUmd9BJNRgAhPCtBHhe81iKPW42WrjzjQSk/s640/ll_lh_hh_hl.jpg" title="PRICE ACTION . . . . the Fundamental Technical Analysis Tool" width="620" /></a></div>
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<span style="font-size: x-large;">The chart above is an example of what I mean by <u>Price Action</u>. </span><br />
<span style="font-size: large;">Price action is a way </span><span style="font-size: large;">to describe what </span><b><u><i><span style="font-size: large;">HAS</span> HAPPENED</i></u></b> <span style="font-size: large;">and what </span><span style="font-size: large; font-weight: bold;"><u><i>IS</i></u></span><b><u><i> HAPPENING</i></u> </b><span style="font-size: large;">in any market</span><span style="font-size: large;">.</span><br />
<span style="font-size: large;">It can be used to extrapolate </span><span style="font-size: large;">what </span><b><u><i><span style="font-size: large;">MAY</span> HAPPEN</i></u></b><span style="font-size: large;"> to price going forward into the future.</span></div><div><span style="font-size: large;"><u>Price Action<b>:</b></u> a very basic tool that can help verify a new direction</span></div><div><span style="font-size: large;"> <span style="color: red;"><i><b>AFTER</b></i></span> a trend has </span><span style="font-size: large;"><b><span style="color: yellow;">REVERSED</span></b><br /></span>
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<span style="font-size: x-large;">The chart below illustrates what I mean by <u>Divergence</u>. </span><br />
<span style="font-size: large;">I define it as follows: price going in one direction while indicators do the opposite. </span><br />
<span style="font-size: large;">The yellow box shows price making a lower low while the indicators make higher lows.</span></div><div><span style="font-size: large;"><u>Price-to-indicator divergence<b>:</b></u> a common pattern that occurs</span></div><div><span style="font-size: large;"> <span style="color: lime;"><b><i>BEFORE</i></b></span> price </span><b><span style="color: yellow; font-size: large;">REVERSES</span></b></div><div><span style="color: yellow; font-size: large;"><b><br /></b></span>
<span style="font-size: large;">Divergence is a very useful tool for technical traders.</span></div>
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ES Chart - 12 minutes per bar spanning two 24 hour sessions.<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgpVjSWtsS77b7wiO9YwTYtZjMjqIk9_0BGs16ym7p8KWe0l6caRUZz3gp9LBn3wcOyZTg2JeSeJXuoDjEDnDgiuMwf0eCYBGaZcaAqOwoIf4bDF8K8_tinscGDRMdl7JI62kVx57XFrdhZ/s1600/reversals%252Brule.jpg" style="margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="380" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgpVjSWtsS77b7wiO9YwTYtZjMjqIk9_0BGs16ym7p8KWe0l6caRUZz3gp9LBn3wcOyZTg2JeSeJXuoDjEDnDgiuMwf0eCYBGaZcaAqOwoIf4bDF8K8_tinscGDRMdl7JI62kVx57XFrdhZ/s640/reversals%252Brule.jpg" title="DIVERGENCE at the BOTTOM" width="640" /></a><br />
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<i style="font-family: "";"><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><span style="font-size: large;">
<u><i style="font-size: x-large;">Hunting for REVERSAL patterns</i></u></span></span></i></h2>
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<span style="font-size: large;">I have observed that price seems to do more </span> <span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;"><span style="background-color: #073763; color: orange;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjwiNWhwWJzWXd8qyL1sD5MHCtIeLX-K_ClzhKqLqSWPbEte2jPlQjd-pEeZS41NczE1uf-1bo1umgfYzWEIKqwv6zTs2C1OnwUdMIqGPMHAP4dU3kWhyphenhypheno9ffEgC86k-G_p0VGubcw1eEdz/s1600/Trend+vs+occillations+(1).jpg" style="background-color: #073763;" target="_blank">oscillating ↓→↑→↓→↑</a></span> (link) </span></span><span style="font-size: large;">than trending </span><span style="font-size: large;">even </span><br />
<span style="font-size: large;">when it can be seen to be moving in one over-all direction for an extended period of time.</span></div>
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<span style="font-size: large;">I have developed trade methods to take advantage of very short term price oscillations.</span><br />
<span style="font-size: large;">These methods work whether the long term or over-all trend is down or up.</span><br />
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<u><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;">My methodologies are applicable for trading long </i></u></h2><div><div><span style="font-size: large;"> </span><span><span style="font-size: large;">See my <a href="http://sharpshortsdaytrading.blogspot.com/p/comparative-trade-scalping-using-etfs.html" target="_blank">Comparative Trade Scalping Method</a> </span></span></div><div><span><span style="font-size: large;">page </span></span><span style="font-size: x-large;"> for a way </span></div><div><span style="font-size: x-large;">to get around this limitation using </span><span style="font-size: x-large;">Bull/Bear ETFs.</span></div></div><div><span style="font-size: x-large;"><br /></span></div>
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<span style="font-size: large; font-weight: normal;">Applying my methods (or an inverse of them) for taking short trades</span></div><div style="text-align: center;"><span style="font-size: large; font-weight: normal;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEj5KCkby80FwLGpo4MO0kSbVFGnSLfNtGwMqGOgWNfVUhMqL13fBKcqys7TBhqGp0Kd6Zylt0qEgNErmO-1RuumKkD0THtlNOXTlugDkfbtq8fUm6FtHsJYk-SkSO61bZAmtAoUTCuinmiZ/s1600/REVERSING+DIVERGENCES-+FAIL.jpg" target="_blank">does not seem to work</a> </span><span style="font-size: large; font-weight: normal;">as consistently </span><span style="font-size: large;">although there</span></div><div style="text-align: center;"><span style="font-size: large;">can be <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhp8VDfSbiroBJYS4gLraoqvfdTvXvQaEYd9lMSgUB0ssZGUAy-d2Cs6JzMZnwGObo9dhZD8BklCLhgNlRl9Xs4rJxDhx3NoZzTuzdgC276ANOo9uaQrAkKUyM3oh85M5W-bhQFuBHaFHOk/s1600/14;52;12.++SHORT+post+for+blog+++++++++++++++++++++++++++++++++++++---.jpg" target="_blank">exceptions (1)</a> and </span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEivV5H0xx8cZGF5ySDjuX_FFiBSdKAkWqJHTb7cqNdyBHnke8FNcfFaKl3RXc6cJ4Kh2C4akXTnd-VP-MAdgOVILtDP8K-xvHyJCJCGZBevnMkRDKB2u2pfwUFfcg84LMJ1b-gPUsttBULt/s1600/DIV%252Bat%252BTOP%25283%2529.jpg" style="font-family: "";" target="_blank"><span style="font-size: large;">exceptions (2)</span></a><span style="font-family: ""; font-size: large;"> </span><span style="font-size: large;">to this rule.</span></div><div style="text-align: center;"><br /></div><div style="text-align: center;">
<span style="font-size: large;"><br />Most of the examples on this blog are showing tick based e-mini Futures charts.<br />The methods, patterns and signals I present work just as well<br /> when using time based charts and for trading stocks or ETFs.</span></div>
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<i style="font-weight: normal;"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ ♦♦♦♦♦ ♦♦♦♦♦ </span></i><i style="font-family: "";"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ </span></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b>II. REVERSALS RULE !</b></i></div>
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<i style="font-family: georgia, "times new roman", serif;"><i style="font-size: x-large;"><i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif; font-size: large;">Section 2 of 6 -- Chart Patterns and Signals </span></i></i></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦ ♦ ♦ ♦ ♦ ♦ </span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦</span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;"> ♦ ♦</span></i></i></div>
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<u><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;">"Typical" Price Action patterns and signals</i></u></h2>
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<span style="font-size: large;">Divergences often print before prices change direction...<i><b>they form </b></i><span style="color: lime;">BEFORE</span><i><b> price</b> </i><b style="font-size: medium;"><span style="color: yellow;">REVERSES.</span></b>.</span><br />
<span style="font-size: large;">They are reliable signals that alert a trader of an impeding re-direction of prices<br />and provide excellent entry points for front running potential new up trends.</span><br />
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<u><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;">"Typical" REVERSAL patterns </i></u></h2>
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<span style="font-size: large;">The next two charts show the development of the same bullish REVERSAL pattern <br /> documented on TIME and TICK based charts.</span><span style="font-family: "georgia" , "times new roman" , serif;"> </span><span style="font-size: large;">The red arrows on the left </span><br />
<span style="font-size: large;"> describe bearish price action, typical of down trends. </span><span style="font-size: large;">The green arrows </span><br />
<span style="font-size: large;">high-light the bullish price action that followed, typical of up trends. </span><br />
<span style="font-size: large;">The colored triangles point out price-to-indicator divergences. </span><br />
<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: ""; font-size: small;">RLM Chart - 3 minutes per bar spanning about 6 hours </span></span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjWrxDd6bB8W31yetpGqgRTlnJX20XOw4P-Lpzu2M18KAUbndosbtTO0wsYOxbRnP4NgHRjwkuQakyafN6QERxidNeIu9s7GTZRGWLYghqVEXsmsBV30NN1rPJBGD8NwRrGcFiPo1Hp7Lc/s1600/REVERSALS+RULE.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img border="0" height="510" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjWrxDd6bB8W31yetpGqgRTlnJX20XOw4P-Lpzu2M18KAUbndosbtTO0wsYOxbRnP4NgHRjwkuQakyafN6QERxidNeIu9s7GTZRGWLYghqVEXsmsBV30NN1rPJBGD8NwRrGcFiPo1Hp7Lc/s640/REVERSALS+RULE.jpg" width="640" /></a></span></div>
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<span style="font-size: large;">The Tick based charts below highlight the same REVERSAL as the Time based chart above. <br />They are a time lapse set of the same Price Action, same Trend Lines and same Indicator signals. <br />(Click on the chart for a larger view in 'slideshow' mode)</span><br />
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<span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"><i style="font-family: georgia, "times new roman", serif;"></i></span><br />
RLM Charts - 75 ticks per bar spanning between 1 to 2 hours<br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEinF4bnDZ8LcV3klHC-S3jZtUp-VOEwLk_4EmoqCVJCnMNTkskEivalCP4tnA4B2BdDurF9chR6j6OsR_U8Wx2Tq9tdFl0H4KgOzd_3zZh7N2smi6Tcw2Ao97FzMz0mkQ271cQM_EjNuTET/s1600/Eat%252Bthe%252Bbear.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="294" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEinF4bnDZ8LcV3klHC-S3jZtUp-VOEwLk_4EmoqCVJCnMNTkskEivalCP4tnA4B2BdDurF9chR6j6OsR_U8Wx2Tq9tdFl0H4KgOzd_3zZh7N2smi6Tcw2Ao97FzMz0mkQ271cQM_EjNuTET/s640/Eat%252Bthe%252Bbear.jpg" width="640" /></a></div>
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<span style="color: cyan;"><span style="font-weight: normal;"><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;">What goes down must go up</i></span><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large; font-weight: normal;">.</i><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large; font-weight: normal;">..</i><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large; font-weight: normal;">In up trends or in down trends</i></span></h2>
<span style="font-size: large;">Link to a <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhHB-1ipPimvqhbK4aCdTOh9dT4UJxk0jEw2do3-1lZxLjw82Ex6LI2CrS0CD7TAAjPgO_lvBZg_ZGvMtdpeka9d89UQkg1Y_uca_hb457v2UHGbwhT0uT6uiWLlmkAYJMmo7TK4c1Pkxn6/s1600/Opportunities+in+down+trends++++++++++++++++++++++++++++++---.jpg" target="_blank">REVERSAL</a> in a "relentless" down trend...<br /> A <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjMjCvS6oKXj81bWu3vd0iXyTI3_L4_VnB4S6GfhRwB7Tqx8cLJG-zRjzt7ymR4O37Rn3tczmYm8gGBC64HQBYab5yDuco7y_BCeQziVub5fuKi1Vneysy8jEZNaJE7OXcno6VkypXk3unU/s1600/3xD+lunch+time.jpg" target="_blank">REVERSAL</a> on multiple time frames...<br /> A <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhwKUFZbM6pN4zK8rsPBYRzaqapgYQD6VNAcZ8QYrvRNvu1yv1VYmLdw6kmpCQc2t4ZqCqmdgheXTG6iEJkavmqTk8V-2mlDJiM-h9XzDi0ZLJ9vXQ-37DtNiERbdDAs2iyULinM-jdIGe6/s1600/original_35133835.jpg" target="_blank">REVERSAL</a> in the early morning...<br /> LONG trades <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg_9i6ueLu6uezHkJ7uKdDmqVnMoNJSPtLAFIJxxt7wz2VPkzyMEfBeeXDd-MHpXg9wmqFEU_dTjBwQJ9X2qdXv_OD8O5MVKrXgLIdPCnmoU15IYD2y2XGQkswCQdm7tMSxvGOTp0s1NEGG/s1600/15;25;35.+3+TF+TLB++++++++++++++++++++++++++++++++++++---.jpg" target="_blank">in a down trend</a> <br /> H&S suggests a <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgfQdXfTTRDfDxmqx3WHsCGRp1qqqQYMXE0YOQOQdfaxXf99Adi8CdzBLHyi8wTfg5fIWS0txBoyYphaQsBim3Uhg2PEsCRy1wXlmCArJMX-YAJvhXxnqz9gZeJ55ac4LpHOLUPwRbRZPgU/s1600/10;51;05.+Signal+development+across+time+frames+II+++++++++++++++++++++++++++++++++++++---.jpg" target="_blank">down trend beginning</a> <br /> <a href="http://images.investorshub.advfn.com/images/uploads/2015/12/3/ckaziDIV_MT_SLING.jpg">Hea</a><a href="http://images.investorshub.advfn.com/images/uploads/2015/12/3/ckaziDIV_MT_SLING.jpg" target="_blank">vy session selling</a> but LONG trades <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjN85D_zAzdM2NXdNzELqxpn0nG1dSpdmDva3nYEF-ZeWUk8PWmm-7uoR8HMF7hupJazK8730qiAA0JVfUGd4sjWz-xMo9UtxyPDHTl1yyhALnx27do-J0XEQV7dXY927-Vk79TJxiznPuE/s1600/counter+trend+longs.jpg" target="_blank"> will still be presented</a></span> </div>
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<i style="font-family: georgia, "times new roman", serif;"><span style="font-size: large;">Don't be put off by the 'busy-ness' of the charts included on this blog...most of the annotations</span></i></div>
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<span style="font-size: large;"><i><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"> were added after the snapshots were taken. </span></span><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"> I draw a lot of trend lines on my trading charts </span></span></i></span><br />
<span style="font-size: large;"><i><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">t</span></span></i><i><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">hroughout </span></span></i></span><span style="font-size: large;"><i><span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;">the day </span></i></span><i><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">but I do not add the notations shown when trading.</span></i><i><span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"> </span></i><br />
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<i style="font-weight: normal;"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ ♦♦♦♦♦ ♦♦♦♦♦ </span></i><i style="font-family: "";"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ </span></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b>III. REVERSALS RULE !</b></i></div>
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<i style="font-family: georgia, "times new roman", serif;"><i style="font-size: x-large;"><i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif; font-size: large;">Section 3 of 6 -- Typical Examples</span></i></i></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦ ♦ ♦ ♦ ♦ ♦ </span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦</span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;"> ♦ ♦</span></i></i></div>
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<i style="font-family: georgia, "times new roman", serif; font-size: x-large;">How I do It</i></h3>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large; font-weight: normal;">The following six example charts present an overview of the recurring events that are discussed throughout this blog... i.e. repeating patterns. My intention is to explain how to take advantage of them via trading, day in day out...</i></h3>
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<span style="font-family: "georgia" , "times new roman" , serif;"><b style="font-style: italic;"> </b><span style="font-size: large;">Explanations of the terms and abbreviations used on the charts are posted here: </span></span><i><b><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"> </span></b></i></div>
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<i><b><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><a href="http://sharpshortsdaytrading.blogspot.com/p/definitons.html" target="_blank"> DEFINITIONS and JARGON</a> </span></b></i></div>
<i style="font-family: Georgia, "Times New Roman", serif;"></i><br />
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<i style="font-family: Georgia, "Times New Roman", serif;"><i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><b><span style="color: cyan;">Example 1</span></b>...</span></i></i><i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: x-large;">First and foremost: Price Action</span></i></div>
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<span style="font-weight: normal;">RLM Chart - 45 ticks per bar spanning less than 15 minutes</span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEitb926EO99n_jwaAV3svyObw0T1zyAWgLPxTxbRFbjhj1LQqiuclWQFrhLiayrwTMa-UHGvmZVtZwNQhrAsio3KDFaiqDdHD3cku3euIDljH4OYcvuY2VDfulTVk9iucEN_9FOjUs5j7w/s1600/PA++TLs+++SIGNALS+++++++++++++++++++++++++++++++++++++---.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="618" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEitb926EO99n_jwaAV3svyObw0T1zyAWgLPxTxbRFbjhj1LQqiuclWQFrhLiayrwTMa-UHGvmZVtZwNQhrAsio3KDFaiqDdHD3cku3euIDljH4OYcvuY2VDfulTVk9iucEN_9FOjUs5j7w/s1600/PA++TLs+++SIGNALS+++++++++++++++++++++++++++++++++++++---.jpg" title="REVERSALS RULE ! take low risk high profit trades" width="640" /></a></div>
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<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><br /></span></i>
<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><b><span style="color: cyan;">Example 2</span></b>...</span></i><i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: x-large;">Trend Lines define the Price Action</span></i></div>
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<span style="font-weight: normal;">RLM Chart - 45 ticks per bar spanning less than 2 hours</span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjQ6-gI-6eCXqmUXa1HXh6JQpoiq2FBj8xhYuWsG7iitHo8G1ucwVaRWl9qK0wESY_a5fJsMYiV0iA27meKGZDzlLeJHkiDuOrTSeTUzgTTZk3nn4OE9THtV-n7sRHKtLbg1mKpqJcgY30/s1600/13%253B31%253B37.%252BPA%252BTLB%252BSIGNALS%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B---.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="640" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjQ6-gI-6eCXqmUXa1HXh6JQpoiq2FBj8xhYuWsG7iitHo8G1ucwVaRWl9qK0wESY_a5fJsMYiV0iA27meKGZDzlLeJHkiDuOrTSeTUzgTTZk3nn4OE9THtV-n7sRHKtLbg1mKpqJcgY30/s640/13%253B31%253B37.%252BPA%252BTLB%252BSIGNALS%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B%252B---.jpg" title="Price Action can be readily seen by using Trend Lines" width="604" /></a></div>
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<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><b><span style="color: cyan;">Example 3</span></b>...</span></i><i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: x-large;">P/A Patterns and Indicator Signals</span></i><br />
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<span style="font-weight: normal;">YM Chart - 120 ticks per bar spanning 2 1/2 hours</span><a href="http://2.bp.blogspot.com/-8Ns5BQw_sNk/VJhMUnDaYPI/AAAAAAAAO40/OWOEKGTGRUA/s1600/PRICE%2BACTION%2BENTRY%2BSIGNALS.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="540" src="https://2.bp.blogspot.com/-8Ns5BQw_sNk/VJhMUnDaYPI/AAAAAAAAO40/OWOEKGTGRUA/s1600/PRICE%2BACTION%2BENTRY%2BSIGNALS.jpg" title="P/A , patterns and Signals...work the same way throughout the session" width="640" /></a></div>
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<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><br /></span></i>
<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><b><span style="color: cyan;">Example 4</span></b>...</span></i><i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: x-large;">Putting it all together</span></i></div>
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<span style="font-weight: normal;">YM Chart - 90 ticks per bar spanning about 30 minutes</span><a href="http://4.bp.blogspot.com/-cnJ7ha3OOlk/VDG5up-UF6I/AAAAAAAALu4/Z0BGu5mCn_M/s1600/A%2B04-04-14--(2%2B%2Bsignal.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="552" src="https://4.bp.blogspot.com/-cnJ7ha3OOlk/VDG5up-UF6I/AAAAAAAALu4/Z0BGu5mCn_M/s1600/A%2B04-04-14--(2%2B%2Bsignal.jpg" title="TREND LINE BREAKS...setting up a price reversal" width="640" /></a></div>
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<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><br /></span></i>
<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><b><span style="color: cyan;">Example 5</span></b>...</span></i><i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: x-large;">Continue to watch Price Action</span></i><br />
<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">Very often you can "miss" acting on signals that are generated on the charts.</span></span><br />
<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">When it happens, DO NOT chase prices -- let price return to you.</span></span><br />
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<span style="font-weight: normal;">RLM Chart - 30 ticks per bar spanning about 30 minutes</span><a href="http://2.bp.blogspot.com/-gjv-ObF_GBE/VDHAhMzogwI/AAAAAAAALv4/UowZnJ5nqVg/s1600/original_22834203.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="576" src="https://2.bp.blogspot.com/-gjv-ObF_GBE/VDHAhMzogwI/AAAAAAAALv4/UowZnJ5nqVg/s1600/original_22834203.jpg" title="Second chance entry patterns - Money-on-the-Floor and Slingshot" width="640" /></a></div>
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<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><br /></span></i>
<i style="font-family: Georgia, "Times New Roman", serif;"><span style="font-size: large;"><b><span style="color: cyan;">Example 6</span></b>...</span></i><span style="font-size: x-large;"><i>Multiple time frames enhance perspective</i></span></div>
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<span style="font-weight: normal;">YM Charts - 60 and 30 ticks per bar spanning less than 1/2 hours</span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUnp1nVDeLCPt6ooIObGBOICZ9uEwCEsxa9NsvrnV2jr_VFPxmM91w-dAKacEgkttDeQcnFKi6UO2mgwCtB7GLJEuYACyDw5Ru-YjLbuRUa07k6euzAVzjsOAKPw-DJpPifQEEYldI583_/s1600/Late+trade+II.jpg" style="font-family: ""; margin-left: 1em; margin-right: 1em;"><img alt="" border="0" height="378" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUnp1nVDeLCPt6ooIObGBOICZ9uEwCEsxa9NsvrnV2jr_VFPxmM91w-dAKacEgkttDeQcnFKi6UO2mgwCtB7GLJEuYACyDw5Ru-YjLbuRUa07k6euzAVzjsOAKPw-DJpPifQEEYldI583_/s640/Late+trade+II.jpg" title=""LATE" --- Similar to MOF + SLING entry using MAC trend + SLING" width="640" /></a></div>
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<span style="font-size: large;"> The examples above are my <a href="http://sharpshortsdaytrading.blogspot.com/p/patterns-and-signal-examples.html" target="_blank">bread-and-butter</a> trade patterns. </span><br />
<span style="font-size: large;">In its simplest form, my method uses Price Action and Trend Lines to identify price reversals :</span><br />
<span style="color: cyan; font-size: large;">...Bullish directional changes - from down to up... </span><br />
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<span style="font-size: large; font-weight: normal;"> The price patterns on the charts may all look the same but note that they are showing different markets <br /> with different time frames and were all 'snapped' on different days at different times of the day.<br /> These types of patterns happen many, many times every day... AND they have been happening <br /> ever since price charts were invented. Thus my premise as stated above:<br /><span style="color: cyan;"> ...In the markets, what goes down must go up...</span></span></h3>
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<i style="font-weight: normal;"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ ♦♦♦♦♦ ♦♦♦♦♦ </span></i><i style="font-family: "";"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ </span></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b>IV. REVERSALS RULE !</b></i></div>
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<i style="font-family: georgia, "times new roman", serif;"><i style="font-size: x-large;"><i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif; font-size: large;">Section 4 of 6 -- Initial Caveats</span></i></i></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦ ♦ ♦ ♦ ♦ ♦ </span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦</span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;"> ♦ ♦</span></i></i></div>
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<span style="font-size: x-small;"><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">If you are excited about the possibilities that easily <span style="font-family: "georgia" , "times new roman" , serif;">recognizable</span>, repeating patterns may present </span></span></h3>
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<span style="font-size: x-small;"><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">that's good...but don't let your initial excitement go too far...</span></span></h3>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><i><a href="http://3.bp.blogspot.com/-LF0C7THREJc/VG-MCtHUciI/AAAAAAAANlw/dSEohq26dJ0/s1600/Good%2Bsignals%2B-%2Bdelayed%2Breaction.jpg" target="_blank">It's not always as easy as it looks</a></i></span></h3>
<span style="font-size: large;">There will be days when you'll see no signals, conflicting signals, or nothing but poor signals ...<br /> Or days with good signals that fail resulting in nothing but stop-outs on the trades you take.</span><br />
<span style="font-size: large;">...The <a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgOOyu_xU2NBEu1eBhYUJomgeXXDyh2r_ap_IYE2QzysxvAmpqQAbli66hSM7vu-NiuqWQFcTqHSHUqopBf85W6nquQzeC-SLvgZY3dBGKZQ26WTCfoi4xe2DGegiBb9hY6hkNDZ_yop2yt/s1600/plans+fail.jpg" target="_blank">best laid plans</a> of mice and men...<br /> Also be aware that reversals can happen at any time</span><br />
<span style="font-size: large;"> without advanced warning from patterns or indicators.<br /><br /> I suggest you find a way to temper your initial excitement</span><br />
<span style="font-size: large;"> and direct your trading with the above caveats in mind. </span><br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-jN5uoyuCkmLzJ13iBSWFkO9NjC5ZnnJxLS8U77F7cG92l7JQ-rhJKMnuRs9WPcNLqx2gXcWM8i3CbjxxmeSQcVuA23VZITl11aLy1oBfvQ9rA2RRbf899UUny_VVjwA6KBvmMd-CI9I/s1600/Disagreeing+indicators.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="380" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEi-jN5uoyuCkmLzJ13iBSWFkO9NjC5ZnnJxLS8U77F7cG92l7JQ-rhJKMnuRs9WPcNLqx2gXcWM8i3CbjxxmeSQcVuA23VZITl11aLy1oBfvQ9rA2RRbf899UUny_VVjwA6KBvmMd-CI9I/s640/Disagreeing+indicators.jpg" width="640" /></a></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"> <b><i>What I do is simple and repetitive :</i></b></span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><b><i> I</i></b></span><i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b>t gets very boring watching squiggly lines on a chart all day !</b></i></div>
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<span style="font-size: large;">If you are able to get through this "Home page" and are interested in learning more </span><span style="font-size: large;">about all the stuff I've posted </span><span style="font-size: large;">I recommend studying the pages that are listed </span><span style="font-size: large;"> on the right hand side. </span><span style="font-size: large;">The pages are numbered by what I consider </span><span style="font-size: large;">to be their level of importance to the learning curve.</span></div>
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<span style="font-size: large;">At this point, I want to stress the absolute necessity of keeping accurate trading records & statistics. U</span><span style="font-size: large;">nderstand their implications to your trading bottom line. I realize that this part of "trading for a living" </span><br />
<span style="font-size: large;">can be the most tedious part of the entire business. </span><br />
<span style="font-size: large;">But neglecting this aspect will prevent you from excelling </span><span style="font-size: large;">at this vocation. </span></div>
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<span style="font-size: large;">Some of the reasons "why they are important" are listed on the page linked below:</span></div>
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<i><b><span style="font-family: "georgia" , "times new roman" , serif;"><a href="http://sharpshortsdaytrading.blogspot.com/p/record-keeping-and-statistics.html" target="_blank">RECORD KEEPING & STATISTICS</a> </span></b></i></div>
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<span style="font-size: large;">---<i>Ignoring your statistics will lead you to ruin</i>---</span></h3>
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<i style="font-weight: normal;"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ ♦♦♦♦♦ ♦♦♦♦♦ </span></i><i style="font-family: "";"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ </span></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b>V. REVERSALS RULE !</b></i><br />
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<i style="font-family: georgia, "times new roman", serif;"><i style="font-size: x-large;"><i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif; font-size: large;">Section 5 of 6 -- Why I Created this Blog </span></i></i></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦ ♦ ♦ ♦ ♦ ♦ </span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦</span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;"> ♦ ♦</span></i></i></div>
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<span style="font-weight: normal;"><i style="font-family: Georgia, "Times New Roman", serif;">This blog is primarily for my benefit.</i><i style="font-family: Georgia, "Times New Roman", serif;"> </i><i style="font-family: Georgia, "Times New Roman", serif;">I created it to keep myself focused on what I love doing, trading for a living. It is my Trader's Log, my Blog-Log if you will. </i><i style="font-family: Georgia, "Times New Roman", serif;">I hope the reader can gain some insights to add to his personal bag of trading tricks.</i></span></h2>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><i> If you have comments, constructive criticisms or questions feel free to contact me.</i></span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><b>sharpshorts2000@yahoo.com</b></span></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;">Everything I do in the markets is documented on this home page </i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;">and the other pages listed on the right hand side.</i></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">Sharpshorts is a day-trader <i>"slash"</i></span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"> scalper, primarily using technical analysis and taking multiple trades every day. Each trade is of very short duration, usually less than 5 minutes of market exposure per trade. </span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"> But the information on this blog can be applied by longer term traders, swing-traders and investors as well. All of the things I describe on these pages happen on any time frame chart you choose to use. They also happen in any market you choose to trade.</span></div>
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<span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-weight: normal;">Although I am aware of market news and fundamentals, I endeavor to keep from being overly influenced by the constant barrage of "financial news" stories published by market news organizations. Most financial news writers cater to a need that people seem to have for "<i>understanding</i> <i>WHY"</i> the markets did what they did...</span></span></span></h3>
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<span style="font-size: large;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-weight: normal;">As entertaining as the presented rationalizations may be, they can not be relied upon as trading tools. </span></span></span></h3>
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<span style="font-size: large;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-weight: normal;">I especially avoid listening to market pundits who present their </span></span><span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;">expert</span><span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"> </span><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-weight: normal;">opinion </span></span></span></h3>
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<span style="font-size: large;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-weight: normal;">about </span></span></span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">what "<i>WILL happen"</i></span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;"> in the markets going forward...</span></h3>
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<span style="font-size: large;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-weight: normal;">IMO, it is somebody's </span><i style="font-weight: normal;">expert opinion</i><span style="font-weight: normal;"> that gets us into any and every mess in the first place...</span></span></span></h3>
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<span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"> </span><span style="font-family: "georgia" , "times new roman" , serif;">I trade primarily using the relatively simple technical </span><span style="font-family: "georgia" , "times new roman" , serif;">methods that are described here. </span></span></span></h3>
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<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">These methods are combined with my"feel" for market actions.</span></span></span></h3>
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<i><span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"> </span></span></span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;"><a href="http://sharpshortsdaytrading.blogspot.com/p/enries-based-on-feel.html" target="_blank">Feel is the more difficult of the two to quantify.</a></span></i></h3>
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<span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">I suggest you acquire the knowledge and </span><u style="font-size: x-large;">own the tools</u><span style="font-size: large;"> I present on this blog before </span></span></span></h3>
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<span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">throwing your hard earned money into the fray...When combined with chart-time experience</span></span></span></h3>
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<span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;"> these tools will produce a reliable "feel" for the trade that will serve you well.</span></span></span></h3>
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<i><span style="font-size: x-large;">Charting Preferences - TICK vs TIME based</span></i></h3>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">Most of the earlier charts on this blog are one minute intervals showing stocks and ETFs. </span></h3>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;"> As I migrate toward concentrating on the e-mini futures I find TICK charts present </span></h3>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">a clearer price action picture and are especially useful for trade entry charts:</span></h3>
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<span style="font-weight: normal;"><span style="font-size: large;">Tick charts are also particularly good for studying the 24 hour price action of the e-minis.</span></span></h3>
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<span style="font-size: large;">(<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEilygKrK2EoxVtTfiEEuwIAWLKk9sFmfAmcNgfZf7jUG9zCr8M5DXd9jd1jc54_0ZRV5msXJ6ChYRDa2k0QcpOp-p2rgGLBSDK1g1SR6LhAB0CIMJyykMRfXnPJaZnN3UdyYsFDDc7moxpO/s1600/30+sec+-+30+tick---.jpg" target="_blank">15 second Time based vs 30 Ticks-per bar</a>)</span></div>
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<span style="font-size: large;"> <span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;">Tick charts often display </span></span><span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"><span style="font-size: large;">patterns that may not be quite as apparent</span><span style="font-size: large;"> on time based charts: </span></span></h3>
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<span style="font-size: large;">(<a href="http://1.bp.blogspot.com/-2fSjJRAPrYQ/U15U-XK-6BI/AAAAAAAAGdU/XrTz595tVXs/s1600/TICK+vs+TIME.jpg" target="_blank">Head & Shoulders</a>) and (</span><span style="font-size: large;"><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjRmgocBDUhesf0a-LK-vtJ9g56JiXRXYlbHV8l9hU0MBC27Hpl0cgoEt1z-razIB1NxVUqmVL3q_5xja7zLG5EAagEnGxpckjRfgVsB-MenuCZ-rf0WQzrjp1rxN0K8qCqtTMhm9ZSRKh0/s1600/cup+&+handle.jpg" target="_blank">Cup & Handle</a>)</span><span style="font-size: large;">.</span></div>
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<span style="font-size: large;"> </span><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">Some other differences in the way TICK and TIME type charts are rendered:</span></span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgVy0mUG9l5kCAJlXZU3xT7xaHl286okEDOxHm3CsSlrQXDqGc3KO4qSmLZRID9kd-Qubg6UjbV2tKqll12S0mtMUvwbD_qM1UjtTqmsfmei0IPaCmb60nRU8tp70A7dhGqiIyHY6n3H0g/s1600/TvT.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="764" data-original-width="1600" height="304" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgVy0mUG9l5kCAJlXZU3xT7xaHl286okEDOxHm3CsSlrQXDqGc3KO4qSmLZRID9kd-Qubg6UjbV2tKqll12S0mtMUvwbD_qM1UjtTqmsfmei0IPaCmb60nRU8tp70A7dhGqiIyHY6n3H0g/s640/TvT.jpg" width="640" /></a></h3>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">TICK charts: each bar represents the number of trades per bar that you chose.</span><br />
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<span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">TIME based charts: each bar represents the length of time that's chosen</span></span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjakazk4GWa46NL1fFaRT-Xkx2iYYuglTUacXDjmT_CptbVwXWLml7cbJmRWqSKgtoSZAg4GqqoeFw6nZI3eckAVH6BRJXCq4QKgZ643rVBfUMTEZi9M3UrSar4mCP66QmrPwH7__7uPmo/s1600/Tick+vs+Time.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" data-original-height="800" data-original-width="1537" height="332" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjakazk4GWa46NL1fFaRT-Xkx2iYYuglTUacXDjmT_CptbVwXWLml7cbJmRWqSKgtoSZAg4GqqoeFw6nZI3eckAVH6BRJXCq4QKgZ643rVBfUMTEZi9M3UrSar4mCP66QmrPwH7__7uPmo/s640/Tick+vs+Time.jpg" width="640" /></a></div>
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<i><span style="font-size: x-large;"><b>Recurring Price Action, Patterns and Signals</b></span></i></div>
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<span style="font-size: large;">I<span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">t should be obvious that most of the charts on this blog were hand picked by me for illustration purposes. </span></span></span></h3>
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<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">Of course they were. They usually show a plethora of patterns and trade signals on each example. </span></span></span></h3>
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<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">Although multiple, confirming signals do occur quite often everyday, you must understand </span></span></span></h3>
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<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">that these things don't always occur simultaneously. Also be aware that the signals that </span></span></span></h3>
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<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">I'm pointing out </span></span></span><span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">do not occur before each and every price reversal...</span></span></span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;"> </span></h3>
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<span style="color: cyan; font-size: large;"><i>Good trade opportunities do not require waiting for 'perfect' sets of signals to happen...</i></span></h3>
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<span style="font-size: large;">O</span><span style="font-family: "georgia" , "times new roman" , serif;"><span style="font-size: large;">n some days, good trading signals print more frequently than they do on other days.</span></span><br />
<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">Rarely will good signals fail to print for an entire day...</span><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">There will also be days </span><br />
<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">that good signals print but </span><a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhDnaIw3KF4gfPgQcB7AjSW8phLR10F7AckwKSeSsv0t9XtCyHiQCwpHRuV2JYj5CASPVk6DNgXWcy9Bu6C6qjORYJNXQB_KbbmQl1tPFA8Yb5gbgAfrBOlSAdKnmIx_xg6bV_BIhRlwAA/s1600/.07%253B57%253B54+-3.jpg" style="font-family: georgia, "times new roman", serif; font-size: x-large;" target="_blank">subsequent price action</a><span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"> fails to print good reversal runs. </span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"><span style="color: yellow;"><span style="background-color: black; font-size: large;">That's what</span><span style="background-color: black; font-size: large;"> </span></span><span style="background-color: black; color: yellow; font-size: large;">STOPs are for :</span></span></h3>
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<i style="font-weight: normal;"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ ♦♦♦♦♦ ♦♦♦♦♦ </span></i><i style="font-family: "";"><span style="background-color: black; color: cyan; font-family: "georgia" , "times new roman" , serif; font-size: large;">♦♦♦♦♦ </span></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><b>VI. REVERSALS RULE !</b></i></div>
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<i style="font-family: georgia, "times new roman", serif;"><i style="font-size: x-large;"><i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif; font-size: large;">Section 6 of 6 -- Discretionary Technical Trading</span></i></i></i></div>
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<i style="font-family: Georgia, "Times New Roman", serif; font-size: x-large;"><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦ ♦ ♦ ♦ ♦ ♦ </span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;">♦</span></i><i style="font-family: ""; font-size: medium;"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;"> ♦ ♦</span></i></i></div>
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<i style="font-family: "";"><span style="background-color: black; color: #9fc5e8; font-family: "georgia" , "times new roman" , serif;"></span></i>
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<span style="font-size: large;"><span style="font-weight: normal;"><span style="font-family: "georgia" , "times new roman" , serif;">Every trade entry decision I make is based upon a deliberate plan, made well ahead of each order placement. There are never any automatic trade actions taken...EVER.</span></span></span></div>
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<span style="font-size: large;"><span style="font-family: "georgia" , "times new roman" , serif;">Every day is different. My personal "feel" for what's currently happening in the market allows my subconscious to recognize actionable activity. Although feel for the trade does not guarantee better results, it does help me decide whether or not to <b>Go-for-It</b> when only minimal or marginal signals print. </span></span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"><span style="font-size: large;"><span style="font-size: large;">4/01/2014 </span><span style="font-size: x-large;"> </span></span></span><br />
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<span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"><span style="font-size: large;"><span style="font-size: x-large;">"Perfect" Signals for entering long positions</span></span></span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-weight: normal;"><span style="font-size: large;">Sometimes multiple signals happen to print simultaneously. </span></span></span></span></h3>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">Very often a second set of signals follow close behind the first set.</span></h3>
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<span style="font-size: large;">8/9/2013</span><span style="font-size: x-large;"> </span></div>
<span style="font-size: x-large;">Signals and Patterns that continually repeat</span><br />
<span style="font-size: large;"><span face=""trebuchet ms" , sans-serif">The following is my description of what the chart below is telling me...</span></span><br />
<span style="font-size: large;"><span face=""trebuchet ms" , sans-serif">it is how I read charts :</span> </span><br />
<span style="font-size: large;"><i style="font-weight: bold;">P/A </i>(price action)<i> </i>was in a <u>down trend</u> with <b><i>LL's & LH's</i></b> (lower lows and lower highs) ... <i><b>2xD </b></i>(two indicator divergence) then<b> </b>developed, alerting me of the potential for an imminent change in direction<span style="color: cyan;">*</span>... price then broke the <b><i>TL</i></b> (Trend Line)<span style="color: cyan;">**</span> and made a new HH before retracing back toward the level where it broke out<span style="color: cyan;">***</span>... P/A then printed a HL <i style="font-weight: bold;">MOF </i>(money on the floor)<i style="font-weight: bold;"> </i>with the MACD EMAs trending up at this point...P/A began to print HH's & HL's, describing a new <u>up trend</u>...<span style="font-family: "times" , "times new roman" , serif;"> </span></span><br />
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<a href="http://3.bp.blogspot.com/-BXscURElk8s/UgVhgzB1udI/AAAAAAAABzM/dT82RZA9R7Q/s1600/2xD....png" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img alt="" border="0" height="457" src="https://3.bp.blogspot.com/-BXscURElk8s/UgVhgzB1udI/AAAAAAAABzM/dT82RZA9R7Q/s640/2xD....png" title="Price Action, Trend Lines, Signals....take the trade" width="640" /></a></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><b><i>How I take positions based on the Signals and Patterns that are described above :</i></b></span></div>
<div style="text-align: center;">
<span style="font-size: large;"><span style="color: cyan;">*</span>1st long entry order signal - <u>Market order</u> - try to enter just below the TL level</span></div>
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<span style="font-size: large;"><span style="color: cyan;">**</span>2nd long entry - <u>Buy Stop</u> - placed just above where price would break the TL</span></div>
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<span style="font-size: large;"><span style="color: cyan;">***</span>3rd long entry - <u>Limit</u> @ the TL break level, for a <i><b>TL break re-test</b></i> entry. </span></div>
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<span style="font-size: large;">You always have the option to take just one type of entry...or all three or none at all. </span></div>
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<span style="font-size: large;">Do not be concerned about missing opportunities.</span></div>
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<span style="font-size: large;"> </span><span style="color: cyan; font-size: large;"><b><i>There will</i></b> <b><i>always</i></b> <b><i>be another trade.</i></b></span></div>
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<span style="font-size: large;">This is the nature and beauty of discretionary trading.</span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large; font-weight: normal;">**********************************</span></h3>
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<span style="font-size: x-large;"><b>Going back in time</b></span><br />
<br />
<span style="font-size: large;">Most of pictures & descriptions below are rendered by MBTrader's <a href="https://sharpshortsdaytrading.blogspot.com/p/mbt-software-features.html" target="_blank">DesktopPro</a> </span><span style="font-size: large;">chart software. These are s</span><span style="font-size: large;">ome of the earliest on this blog. They were among the first ones added back when I started to publicly document my methods. </span><br />
<span style="font-size: large;"><br /></span>
<span style="font-size: large;">I became aware of most these ideas more than 25 years ago.</span><br />
<span style="font-size: large;">They have weathered the test of time and are as applicable today as they have ever been...</span><br />
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<span style="font-size: large;"><b>3/08/2012</b></span></div>
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<span style="font-size: large;">3xD <i><u>Buy STOP+TTO</u></i> at the Trend Line trade</span></div>
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<span face=""verdana" , sans-serif" style="font-size: large;">TTO = Threshold Trade Order a.k.a bracket order </span></div>
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<span style="font-size: large;">Below is an example where I spotted the three indicator divergence (3xD) just a little too late to place a
<i><u>Market+TTO</u></i> order under the trend line (the dotted vertical line points out when the divergences in the study pane can first be spotted). But I was able to place an anticipatory <u style="font-style: italic;">Buy-Stop+TTO</u> order at the
trend line before price broke out, which got a fill....For the NQ ($5.00 per tick) I had my TTO
offset order preferences set for a 6 tick protective sell stop
(1.50 points, or $30) and a 12 tick target stop (3 points or $60)...</span><br />
<span style="font-size: large;"></span><br /></div>
<div style="text-align: center;">
<span style="font-size: large;">Note
that after getting my fill, there was plenty of time to change the
order type to a <i><u>Limit+TTO</u></i> if I had wanted to try to add additional
contracts using a TLB-RT (Trend Line Break Re-Test) order...I like to add contracts at the TLB-RT area, especially after </span><span style="font-size: large;">a first entry that had a very good fill -- like one that was filled immediately after the divergence was spotted, well under the trend line.</span></div>
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This is a 60 tick chart </div>
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<span style="font-size: large;"><a href="http://1.bp.blogspot.com/-LwotgeHfaa8/UTo6fGJGTwI/AAAAAAAABPw/vGMgiID22is/s1600/Perfect+3xD+.JPG" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="640" src="https://1.bp.blogspot.com/-LwotgeHfaa8/UTo6fGJGTwI/AAAAAAAABPw/vGMgiID22is/s640/Perfect+3xD+.JPG" width="604" /></a> </span><br />
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<a href="http://3.bp.blogspot.com/-OfjGVas9ujM/UYO9y9FrahI/AAAAAAAABeg/icU90UjNmDc/s1600/05-03-13+2xRd++17.jpg" style="margin-left: 1em; margin-right: 1em;"></a><br /></div>
<span style="font-size: large;"><b>3/14/2012</b> </span><br />
<span style="font-size: large;"> </span><span style="font-size: x-large;">2xD Divergence can be powerful too...</span><br />
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;">A
<i><u>Limit+TTO</u></i> order relies on a retest of a break-out point and is sort of a late-to-the-party trade relative to using a <i><u>Market+TTO</u></i> order immediately after divergences below the trend line are identified. But on most days they will provide good fills with reasonable stops. It is not always easy to to place 'perfect' <i><u>under-the-trend-line-early-entry orders</u></i>, especially on very active days.</span></span></span><br />
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<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;">Below is a 120 tick chart which <span style="font-size: small;">draws price bars</span> much s<span style="font-size: small;">lower than the 90T, 60</span>T and/or 45T charts I usually use when trading the YM...but so far on this day, trade activity had been at a far greater pace than on average<span style="font-size: small;">.</span></span></span></span><br />
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<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;">This chart shows where to place "late" limit orders...T</span>he solid <span style="font-size: small;">lime line crossing the teal down trend line (circled area) is the <span style="font-size: small;">trend-line-break level. In this example, both 2xD plays would have been filled on retests, w<span style="font-size: small;">ithout <span style="font-size: small;">price coming</span> near <span style="font-size: small;">a tight 6 tick stop...you might even have gotten a better fill by a tick or two, if the order was entered while <span style="font-size: small;">price was dipping...</span></span></span></span></span></span></span></span><br />
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<span style="font-family: "";">YM Chart - 120 ticks per bar spanning about 2 1/2 hours </span><br />
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><a href="http://4.bp.blogspot.com/-cTEETmdcQMM/UUICOwlJe9I/AAAAAAAABS4/Bk7qhCS_3DA/s1600/ORDER+TYPES+.png" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="409" src="https://4.bp.blogspot.com/-cTEETmdcQMM/UUICOwlJe9I/AAAAAAAABS4/Bk7qhCS_3DA/s640/ORDER+TYPES+.png" width="640" /></a></span></span></span></span></span></span></span></span><br />
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<span style="font-size: large;"><b>5/3/2013</b> </span><br />
<span style="font-size: large;"> </span><span style="font-size: x-large;">2xD followed by 2xRD </span><br />
<span style="font-size: large;"><span style="font-size: small;"></span></span>
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<div style="text-align: center;">
<span style="font-size: large;"><span style="font-size: small;">The <b>Lower Highs</b> and <b>Lower Lows</b> price/action of the </span></span><span style="font-size: large;"><span style="font-size: small;"><b><span style="font-size: large;"><span style="font-size: small;"><u><i>previous down trend</i></u> </span></span></b>on the lower left hand side of the price pane </span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">(yellow diagonal line) </span></span>is reversed after the divergences developed. <span style="font-size: large;"><span style="font-size: small;">A <b><u><i>new up trend</i></u></b> </span></span></span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">is then defined </span></span></span></span>by the</span></span> series of <b>Higher Highs</b> and <b>Higher Lows</b> that printed after price broke above the down trend line.</span></span></div>
<div style="text-align: left;">
<div style="text-align: center;">
<span style="font-size: large;"><span style="font-size: small;"><b>Regular</b> <b>divergences (2xD)</b> suggested an imminent trend change </span></span>(LL on price while the MACDh and STO made HL's).</div>
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<div style="text-align: left;">
<div style="text-align: center;">
<span style="font-size: large;"><span style="font-size: small;"><b>Reverse</b> <b>divergences (2xRD)</b> suggests </span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">continuation of </span></span>the <i><u><b>'new'</b></u></i> trend </span></span> (HL on price while the MACDh and STO made LL's)</div>
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<div style="text-align: center;">
<span style="font-size: large;"><span style="font-size: small;"><br /></span></span>
<span style="font-size: large;"><span style="font-size: small;">Notice that this chart illustrates 3 potential entry points with good signals <b>:</b></span></span><br />
<span style="font-size: large;"><span style="font-size: small;"><i style="font-weight: bold;">A ----</i>-----------------<i style="font-weight: bold;"> 2xD and then a TL break</i></span></span><br />
<span style="font-size: large;"><span style="font-size: small;"><i style="font-weight: bold;">B ----- TL break Re-Test MOF and Slingshot</i></span></span><br />
<span style="font-size: large;"><span style="font-size: small;"><i style="font-weight: bold;">C ------------ 2xRD continuation of new trend</i></span></span><br />
<span style="font-size: large;"><span style="font-size: small;"><br /></span></span>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUIolyWllRIB2JA0vAuqXhpXhtmDZ0-wpEUrS4sym1q9hDsCUxlpbx1PjKgJwfonYPn6fiLyAc1w0IOGx3g9lv8FMArcO2x5Bwqk5NBrwx2YEAIdpeHL4CIsJ4s6ACIbRgRuM99Ea-GqcR/s1600/Untitled%25282%2529.png" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="608" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUIolyWllRIB2JA0vAuqXhpXhtmDZ0-wpEUrS4sym1q9hDsCUxlpbx1PjKgJwfonYPn6fiLyAc1w0IOGx3g9lv8FMArcO2x5Bwqk5NBrwx2YEAIdpeHL4CIsJ4s6ACIbRgRuM99Ea-GqcR/s640/Untitled%25282%2529.png" width="640" /></a></div>
<span style="font-family: "georgia" , "times new roman" , serif;">On the chart above - price printed a HH after making the Trend Line Break...it then retraced back</span><br />
<span style="font-family: "georgia" , "times new roman" , serif;"> to test the level where it broke out (TLB Re-Test) and printed a HL. </span><span face=""verdana" , sans-serif">This particular HL is also known as</span><br />
<span face=""verdana" , sans-serif"> a <b><i><u>Money-on-the-Floor</u></i></b> pattern while a <b><i><u>Slingshot</u></i></b> pattern is developing on the</span><br />
<span face=""verdana" , sans-serif"> stochastic indicator at the same time.</span><br />
<span face=""verdana" , sans-serif">These two patterns help to identify and to confirm the reversal, from down to a new up trend...</span><br />
<span face=""verdana" , sans-serif">They are both described in detail on my <b><a href="http://sharpshortsdaytrading.blogspot.com/p/miscellanious.html" target="_blank">Money on the Floor</a> </b>page.</span><br />
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<br />
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><b>4/25/2013 </b> </span></span></span></span></span></span></span></span></span></span></span><br />
<span style="font-size: medium;"><span style="font-size: x-small;"><span style="font-size: x-small;"><span style="font-size: x-small;"><span style="font-size: x-small;"><span style="font-size: x-small;"><span style="font-size: x-small;"><span style="font-size: x-small;"><span style="font-size: medium;"><span style="font-size: x-small;"><span style="font-size: x-large;"> 2xD followed by 2xRD</span></span></span></span></span></span></span></span></span></span></span><br />
<div style="text-align: center;">
<span style="font-size: large;"><span style="font-size: small;">2xD indicates the start of a new bullish </span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">trend</span></span>...</span></span><span style="font-size: large;"><span style="font-size: small;"> </span></span></div>
<div style="text-align: center;">
<span style="font-size: large;"><span style="font-size: small;">2xRD then indicates an 'overdone' short term pull back has occurred...</span></span></div>
<span style="font-size: large;"><span style="font-size: small;"> I use this signal as </span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">confirmation </span></span>that the </span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">new bullish </span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;">trend</span></span></span></span> should continue.</span></span><br />
<span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: large;">I include this 120 minute-per-bar chart to demonstrate that price action works very similarly</span></span></span></span></span></span></span></span><br />
<span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: large;"> regardless of the time frame you may choose to view.</span></span></span></span></span></span></span></span><br />
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;">In this example, over a month's worth of the DJIA e-mini sessions are included. </span></span></span></span></span></span></span></span>
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;"> </span></span></span></span></span></span></span></span><a href="http://4.bp.blogspot.com/-MZtAaLlVAbY/UXlm6RNGZUI/AAAAAAAABbI/2TzmsfsZxwY/s1600/2xD+++2xRD+bullish.jpg" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="494" src="https://4.bp.blogspot.com/-MZtAaLlVAbY/UXlm6RNGZUI/AAAAAAAABbI/2TzmsfsZxwY/s640/2xD+++2xRD+bullish.jpg" width="640" /></a> <br />
<br />
<span style="font-size: large;"><b>3/13/2012</b></span><br />
<span style="font-size: x-large;">Multiple Time Frames</span><br />
<span style="font-size: large;"><span style="font-size: small;">Viewing
multiple 'time frames' can be helpful in confirming 3xD trade signals
and more. Here I'm using both 90 & 120 tick charts for the NQ e-mini futures. Divergence is <span style="font-size: small;">apparent</span> on both charts<span style="font-size: small;">, suggesting an imminent trend reversal</span>. The yellow, gray and red diagonal lines<span style="font-size: small;"> in both studies </span></span></span><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;">clearly </span></span></span>show the divergences on each indicator. The aqua vertical line marks the point where the divergences can first be identified - that's when to place your orders.</span></span></span><br />
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><br /></span></span></span>
<span style="font-size: large;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-size: small;">The 90T allows you to optimize your entry and suggests <b><i>where</i></b> a reasonably <span style="font-size: small;">tight</span> <b><u>stop-loss</u></b> order <span style="font-size: small;">can be placed</span>...The <span style="font-size: small;">120T chart gives a better perspective <span style="font-size: small;">for <span style="font-size: small;">determining</span> how much of a reversal you might expect from the divergence in order to set a reasonable <u><b>target</b></u>... </span></span></span></span></span></span><br />
<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg_Mj8u3gf_q3EuEDvnQgEkLMj8U9mh7Mh-4RDJdeqmLeTsnGyPTEYkYSgifpXhWiCmSChVGyfvqx8nEUGGjwqPvKUoB5qQ2VAaBqYHDNTMJ_aNb9AAojOAnds9JTzwHA76Xon0ahLF6Oo/s1600/Multi+time+frames.png" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="344" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg_Mj8u3gf_q3EuEDvnQgEkLMj8U9mh7Mh-4RDJdeqmLeTsnGyPTEYkYSgifpXhWiCmSChVGyfvqx8nEUGGjwqPvKUoB5qQ2VAaBqYHDNTMJ_aNb9AAojOAnds9JTzwHA76Xon0ahLF6Oo/s640/Multi+time+frames.png" width="640" /></a><br />
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<h3>
<span style="color: #cccccc; font-family: "georgia" , "times new roman" , serif; font-size: large;"><span style="font-weight: normal;">Comparing Histogram Divergences</span> </span></h3>
<span style="color: cyan;"><span style="font-size: small;"><span style="font-size: small;"><span style="font-family: "georgia" , "times new roman" , serif;"> </span><span face=""verdana" , sans-serif" style="color: #cccccc;">Notice that the 90T on the right has a MACD histo and a TRIX histo in the study panes...Both are trend indicators and work very similarly - its just a matter of preference as to<span style="font-size: small;"> </span>which to use (see the next chart for further comparisons)...The 180T chart also shows Stochastic divergence.</span></span></span></span><br />
<span style="color: cyan;"><span style="font-size: small;"><span style="font-size: small;"><span style="color: #cccccc;"> Its not unusual to have divergence on one time frame but not on the others. </span></span></span></span><br />
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<a href="http://3.bp.blogspot.com/-PhwZxb1XlOc/UUpprV1pjyI/AAAAAAAABUw/JxRhSATYZDw/s1600/180-120-90T.jpg" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="314" src="https://3.bp.blogspot.com/-PhwZxb1XlOc/UUpprV1pjyI/AAAAAAAABUw/JxRhSATYZDw/s640/180-120-90T.jpg" width="640" /></a></div>
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<a href="http://1.bp.blogspot.com/-tnwzj3Dbn40/UUC_H1IUA_I/AAAAAAAABSQ/ntqlKGmf_5s/s1600/10+AM+Reversal+Zone.png" style="margin-left: 1em; margin-right: 1em;"></a><br /></div>
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<span style="font-weight: normal;"><span face=""trebuchet ms" , sans-serif">The following chart is for comparing the TRIX histogram with its EMAs to the MACD histogram and EMAs.</span></span></h3>
<h3>
<span style="font-weight: normal;"><span face=""trebuchet ms" , sans-serif">It also highlights relationships with the yellow Stochastic slow %D line and with price action.</span></span></h3>
<h3>
<span style="font-weight: normal;"><span face=""trebuchet ms" , sans-serif">You can see the similarities as well as differences easily...</span></span></h3>
<a href="http://1.bp.blogspot.com/-ED_c6RXTNLQ/U3IDUMkVSjI/AAAAAAAAG8g/aEd_2en1qmM/s1600/trix+VS+macd.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="528" src="https://1.bp.blogspot.com/-ED_c6RXTNLQ/U3IDUMkVSjI/AAAAAAAAG8g/aEd_2en1qmM/s1600/trix+VS+macd.jpg" width="640" /></a><br />
<h3>
<span face=""trebuchet ms" , sans-serif" style="font-weight: normal;">Another comparison of differing histograms...the same price action and time span are shown on both charts</span></h3>
<h3>
<span face=""trebuchet ms" , sans-serif" style="font-weight: normal;">TRIXh over MACDh on the left hand side.................Awe Osc over MACD on the right</span></h3>
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<a href="http://3.bp.blogspot.com/-YbXj3BCYJGY/U9V1Wqaf0WI/AAAAAAAAJXc/gWPU8ok2fmU/s1600/Histos+compared+++++++++++++++++++++++++++++++++++++---.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="300" src="https://3.bp.blogspot.com/-YbXj3BCYJGY/U9V1Wqaf0WI/AAAAAAAAJXc/gWPU8ok2fmU/s1600/Histos+compared+++++++++++++++++++++++++++++++++++++---.jpg" width="640" /></a></div>
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<h3>
<span style="font-weight: normal;">Other combinations of trending and oscillating indicators can work just as well as the ones shown above.<br />Most will show very similar shapes & patterns ...<br />In the charts above, the scales for the TRIXh, the Awesome Oscillator and the MACD (with it's EMAs) are on the left while the Stochastic is on the right. The actual scaling numbers are not that important to me. I'm more interested in seeing the relationships between the indicators with price. If my software would allow it, I would turn off all the left hand scales.<br /><i>(I discovered a way to turn off </i><i>the price pane's </i><i>LH scale in later snapshots)</i><br />In my view, the stochastic and each of the histograms are <i>oscillators</i>...BUT the TRIX EMA <i><u>lines</u></i> and MACD EMA <u><i>lines</i></u> indicate <i>trending attributes</i> of price.<br />I do look at over-bought and over-sold positions of the stochastic line within the study pane...and although I use MACD <i>EMA</i> crosses, I do not concern myself so much about whether they occur above or below the center line.</span></h3>
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<span style="font-size: large;"><span style="font-size: large;"><b>12/11/2012</b></span> </span><br />
<span style="font-size: x-large;">The following set up presented three ways to make an entry...</span><br />
<div style="text-align: center;">
<h3>
<span style="font-weight: normal;">1) <a href="http://www.mbtrading.com/help/navpro/NavPro.htm" target="_blank">Market+TTO</a> entry below the trend line<br />(for immediate entry)<br /> 2) <u><a href="http://www.mbtrading.com/help/navpro/NavPro.htm" target="_blank">Stop+TTO</a></u> at the trend line, directly above the developing bar<br />(entry order would be activated if or when price broke-out)<br /> 3) <a href="http://www.mbtrading.com/help/navpro/NavPro.htm" target="_blank">Limit+TTO</a> at the trend line after the break-out<br /> (requiring a re-test of the break-out level for entry)<br />(The links above take you to MBT's NavPro documentation - See chapter 13 - Order Type)<br /> <br />All three types of orders could have been deployed. After the 3 indicator divergence set up was spotted there was at least a minute to place the orders.<br />I didn't see it until after the trend line was penetrated but was able to participate on the move because shares happened to retrace to .01 below my limit @111.97 as price re-tested the breakout point.<br /> The indicators in the study panes on these charts use a Stochastic (
9,2,3
yellow line), a standard MACD without a histogram (aqua and red lines)
and a TRIX
histogram (light blue bars). The other Stochastic (12,3,3) listed in the
pane is used to create the black background for the study. It covers
some background lines but is otherwise hidden. The last number (1)
listed within the parenthesis next to some of the legends for the indicators is the
chart interval... </span></h3>
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<a href="http://1.bp.blogspot.com/-n0uAB7C3jT8/UMfs1C4XPeI/AAAAAAAAAgI/4ctTqqlB7_Q/s1600/12-11-12+002.jpg" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" src="https://1.bp.blogspot.com/-n0uAB7C3jT8/UMfs1C4XPeI/AAAAAAAAAgI/4ctTqqlB7_Q/s1600/12-11-12+002.jpg" /></a></div>
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<span style="font-size: large;"><b>12/10/2012</b></span></div>
<h3>
<span style="font-weight: normal;"><span style="font-size: small;">Three Indicator Divergence </span>does not happen all the time but it usually allows for a very good scalp trade when it does. Note on the chart below that it occurred once at 11:30 but it was a bit more difficult to rationalize an entry being that it was harder to see where the trend line of the recent price action was...</span></h3>
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<a href="http://1.bp.blogspot.com/-ZOPBznSsTIw/UL5AiJX85nI/AAAAAAAAAZU/mNTNC0zUvQA/s1600/3+Indicator+Divergence.jpg" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="496" src="https://1.bp.blogspot.com/-ZOPBznSsTIw/UL5AiJX85nI/AAAAAAAAAZU/mNTNC0zUvQA/s640/3+Indicator+Divergence.jpg" width="640" /></a></div>
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<br />
<span style="font-size: large;"><b>12/06/2012</b></span> <br />
<h3>
<span style="font-weight: normal;">Another example of a three indicator divergence scalp trade allowing an entry before price action makes the breakout of the trend line.</span></h3>
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<a href="http://1.bp.blogspot.com/-pXPm91-LEhc/UMED4e03lRI/AAAAAAAAAbM/dnG5TVhsfQg/s1600/12-06-12+3+ind+div.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="572" src="https://1.bp.blogspot.com/-pXPm91-LEhc/UMED4e03lRI/AAAAAAAAAbM/dnG5TVhsfQg/s640/12-06-12+3+ind+div.jpg" width="640" /></a></div>
<br />
<span style="font-size: large;"><b>12/07/2012</b></span><br />
<h3>
<span style="font-size: large; font-weight: normal;"><i>Entry signals - Divergence vs. Trend Line break retest</i></span></h3>
<h3>
<span style="font-weight: normal;">The chart below illustrates the power of 3 indicator divergence and the relative safety of this trade entry vs. playing a trend line break and waiting for a re-test of that point for entry.<br /> Normally I would have cancelled order # 2 after three to five minutes since there was no immediate retest after the TL break, rather than leaving it live for the 15+ minutes as shown on the chart.</span></h3>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg6unYq2bwKlKULVJ2zHF9W7ZZhjSBXwKGC8CcuaZsmR7tPBMtAkpZ0oswpf7mp-C7htzYGTUo6JC_65SNbLJrdTXlkED-Q3Q776AAX7dJOInZaXa1AdUBfj3qeGGl3J2uNjtSZYIGxKDh9/s1600/Divergence+vs+Retest+++%25281%2529.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="572" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEg6unYq2bwKlKULVJ2zHF9W7ZZhjSBXwKGC8CcuaZsmR7tPBMtAkpZ0oswpf7mp-C7htzYGTUo6JC_65SNbLJrdTXlkED-Q3Q776AAX7dJOInZaXa1AdUBfj3qeGGl3J2uNjtSZYIGxKDh9/s640/Divergence+vs+Retest+++%25281%2529.jpg" width="640" /></a></div>
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<span style="font-size: large;"> </span><br />
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<a href="http://3.bp.blogspot.com/-OfjGVas9ujM/UYO9y9FrahI/AAAAAAAABeg/icU90UjNmDc/s1600/05-03-13+2xRd++17.jpg" style="margin-left: 1em; margin-right: 1em;"></a><br /></div>
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<span style="color: lime;"><span style="font-size: x-large;">There is always another trade</span></span> <br />
<h3>
<span style="font-weight: normal;">Avoid second guessing your trade decisions - Learn from losing trades and yes, analyze stop-outs to determine if your entry reasons were valid...<br />But DO NOT second guess yourself or engage in coulda-woulda-shoulda thinking. These things will cloud your abilities and interfere with successful trading.</span></h3>
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<a href="http://3.bp.blogspot.com/-I7C3xFuXR1c/UUIU-dV5SAI/AAAAAAAABTI/o_FTgTnfG48/s1600/Coula-shoulda.png" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="278" src="https://3.bp.blogspot.com/-I7C3xFuXR1c/UUIU-dV5SAI/AAAAAAAABTI/o_FTgTnfG48/s640/Coula-shoulda.png" width="640" /></a></div>
<h3>
<span style="font-weight: normal;">What happened later, you might be asking?<br />Talk about what second guessing and <span style="color: yellow;"><u><i>coulda-woulda-shoulda</i></u><i>s</i></span> can do to you...<br /> 'I <span style="color: yellow;"><i>coulda</i></span> used a 7 tick stop instead of 6, <span style="color: yellow;">woulda</span> won this trade...wonder if I <span style="color: yellow;"><i>shoulda</i></span> increase it...' </span></h3>
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<a href="http://1.bp.blogspot.com/-19YoP63L6T4/UUIYS3jhngI/AAAAAAAABTY/04IEoDhT4ho/s1600/LATER.png" style="margin-left: 1em; margin-right: 1em;" target="_blank"><img border="0" height="560" src="https://1.bp.blogspot.com/-19YoP63L6T4/UUIYS3jhngI/AAAAAAAABTY/04IEoDhT4ho/s640/LATER.png" width="640" /></a></div>
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<span style="color: lime;"><span style="font-size: large;">Don't sweat the coulda-<span style="font-size: large;">woulda-shouldas...</span> </span></span></div>
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<span style="color: lime;"><span style="font-size: large;">There is <u>always</u> another trade</span></span></div>
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<span style="color: #cfe2f3; font-weight: normal;">Little can be gained by focusing on bad trades...unless you recognize them when they happen...</span></h3>
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<a href="http://4.bp.blogspot.com/-2cG0woYgR4I/VE0-XAHUxDI/AAAAAAAAMec/FwJUKDg2Z8c/s1600/another%2Btrade%2B1%2Bmodified.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="226" src="https://4.bp.blogspot.com/-2cG0woYgR4I/VE0-XAHUxDI/AAAAAAAAMec/FwJUKDg2Z8c/s1600/another%2Btrade%2B1%2Bmodified.jpg" width="640" /></a></div>
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<span style="color: #cfe2f3; font-size: large;">AND</span></div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhmx3drMaFTZHoLrappX9QPvvP2tUdXFfSqAHLJr7GSw9g3R0zgslzbNeSmKvizXD0NJ0wiDDq7yRSLnSCzSTxROriIzg3vcF4QYJP4tdbBUGH7mMRHJdxRon6P1Jc-9lYy8TWkGVhRtvA/s1600/Another+trade+2+modified.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="276" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEhmx3drMaFTZHoLrappX9QPvvP2tUdXFfSqAHLJr7GSw9g3R0zgslzbNeSmKvizXD0NJ0wiDDq7yRSLnSCzSTxROriIzg3vcF4QYJP4tdbBUGH7mMRHJdxRon6P1Jc-9lYy8TWkGVhRtvA/s1600/Another+trade+2+modified.jpg" width="640" /></a></div>
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<span style="font-size: large;">3/19/2014 </span></div>
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<span style="font-size: x-large;">Good signals don't always guarantee a gain...</span></div>
<h3 style="clear: both; text-align: center;">
<span style="font-weight: normal;">Using a Buy-Stop above price can keep you out of a trade that does not move in the direction you were anticipating...<br />Here's an example when good signals fail to reverse P/A...The signals firing on the LH chart suggested that a reversal, from down to up was potentially imminent. <br />Spotting the signals, I placed an order...because I was <i>"trailing-down"</i> my buy-stop order <i>(placed above the TL and above the current bar)</i>, I was not filled before price continued to fall (see RH chart)...thus saving me from having to rely on my stop-loss to limit the damage from a losing trade...<br />The green Buy-Stop order line and white auto offsets are shown on the charts.<br />You can drag & drop the order line to trail a buy-stop down - this will also move the offsets correspondingly. </span></h3>
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<a href="http://4.bp.blogspot.com/-Ytqvcq3ujYU/Uym-qIe4xEI/AAAAAAAAFVg/Fr4-jRL_dJw/s1600/A+03-19-14--(3+buy-stop+no+fill++.jpg" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="386" src="https://4.bp.blogspot.com/-Ytqvcq3ujYU/Uym-qIe4xEI/AAAAAAAAFVg/Fr4-jRL_dJw/s1600/A+03-19-14--(3+buy-stop+no+fill++.jpg" width="640" /></a></div>
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<span style="font-size: large;">Good signals don't always guarantee a gain</span><span style="font-size: x-large;">...</span><span style="font-size: large;">nor do they guarentee a reversal. </span></div>
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<span style="font-size: large;">Sometimes price changes its direction </span><span style="font-size: large;">from down to side ways.</span></div>
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<span style="font-size: large;">Sometimes there are multiple 'good' signals but they 'fail'.</span></div>
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<span style="font-size: large;">AND</span></div>
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<span style="font-size: large;">Sometimes price will reverse without giving any signals at all.</span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><i>You have to continually ask yourself the question:</i></span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;"><i>"Do you trade for excitement or to take money from the market?"</i></span></div>
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<span style="font-family: "georgia" , "times new roman" , serif; font-size: large;">Well, do you?</span></div>
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sharpshortshttp://www.blogger.com/profile/12207274525737796144noreply@blogger.comtag:blogger.com,1999:blog-4179897063443125494.post-77130370697566551762012-01-08T10:35:00.000-05:002018-08-30T16:50:50.630-04:00TL break+volume+divergence<div class="separator" style="clear: both; text-align: center;">
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<i>Note: This post is one of the earliest remaining examples that was added when I began to develop this blog.</i><br />
<i>It shows a trade in Valero Energy using a 3 minute per bar chart...Although the market, the time frame and the chart color is different from most of those in my later posts, notice that I am still using the method described...</i><br />
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A scalper's dream set up...multiple rational for entry. </div>
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The stock chosen must have the liquidity to handle market entry and exit of a few thousand shares so that you avoid getting scalped...</div>
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I'll take even .15 or .18 for exposure of 15 to 25 minutes.<br />
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<span style="background-color: #660000;"><span style="color: #fff2cc;">Once you see the divergence setting up, there is time enough to enter an 'anticipatory'<b> Limit+TTO </b>(at or above the current bar)...</span></span></div>
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<span style="background-color: #660000;"><span style="color: #fff2cc;">OR - place a <b>Market+TTO</b> below the trend line in an attempt to get a better fill... i.e. getting an early fill in anticipation of a divergent bounce through the trend line.</span></span></div>
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<span style="background-color: #660000;"><span style="color: #fff2cc;">But very often, its better to enter a buy <b>Stop+TTO</b>
order at the point where price would break the trend line, above the
current bar, to be sure of getting a fill <b><span style="font-size: large;">IF</span></b> price does indeed make the expected divergent bounce up. If the stop order is
not filled by the completion of that bar, you can move the stop price down along the trend line while the
next bar is developing.</span></span></div>
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<span style="background-color: #660000;"><span style="color: #fff2cc;">This entry method avoids the potential problem of getting your 'anticipatory' <b>Limit+TTO </b>or <b>Market+TTO</b> order filled, only to watch as price first spikes down to your automatic TTO sell-stop, which could take you out just before the move goes in the anticipated direction... </span></span></div>
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sharpshortshttp://www.blogger.com/profile/12207274525737796144noreply@blogger.com