This entry was posted on Monday, October 15th, 2007 at 8:33 pm and is filed under Education, chart patterns. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
Ever since I recorded my intraday trades I have received an endless stream of readers looking for further tips. The videos themselves are an excellent resource to see some of the types of entries I might take during the day. But the basis for framing biases are really based upon very very simple ideas of identifying trends.
An up trend is a series of higher highs and lows. While a downtrend is a series of lower highs and lows. I have mentioned before that I found Stan Weinstein’s work in this area a great way to frame the “where are we now?” Trendlines can play an important role as well to see logicalĂ‚Â resistance and exhaustion points on a chart.
Todays mid morning action was a trend down type scenario in the Nasdaq futures that for me exemplified some logical entry points as well as clear swing high points that would have changed the picture enough that I would have been able to see I was wrong.
Those turn point areas on the indicator make nice entry points with definable risk as marked by the red line at swing highs. Remember waves. If it does not look like a wave - it’s not. Today had some clear wave patterns I liked. Keep an eye out for those.
In my videos I was trying to show you how to play band to band mostly, where fading moves into logical resistance were the plays. With this other type of trading we are recognizing a trend or bias is in place and we want to trade with that. Those are clearly 2 diametrically opposed type of systems but sometimes the fading of extremes type entries can lead to being able to add to a position once the trend entry kicks in. Big waves and wavelets each with their own risk and position size is how I try to trade and analyze the market as it unfolds each day.
Have a Great Night!
Dave Johnson
October 17th, 2007 at 8:52 am
Beautiful post, Dave! I hope many aspiring traders read it really think about what you are saying.
October 18th, 2007 at 7:23 am
Thanks Ed.
I should do more of this intraday stuff. So much to do so little time.