A Wedge reversal (three or four pushes each with a new extreme) forming at the top or bottom of a trend is probably the most successful setup for a swing trade.
The most crucial prerequisite for a Wedge reversal is a clear trend channel line overshoot and in particular a second overshoot. Other strengtheners / requirements are: Continue reading “Trade the 1st Pullback after a Wedge – the W1P!”
“Barb Wire” is a special kind of a tight trading range, where the price action is confined to a narrow range made up of small bars, many of which are dojis (large tails and small bodies). Continue reading “What to do with “Barb Wire”?”
Once a Reversal Signal shows up on the chart place a stop entry buy order one tick above the bar or pattern (for bull). The closest logical stop goes below the bar or pattern – a bar/pattern stop.
Inside bars (by definition) are completely overlapped by the prior bar and must be considered to be a small trading range. This usually makes them poor Signal Bars, unless they occur with trend or meet a couple more criteria. Continue reading “Inside Bars”
The first counter trend break of a channel move is called 1CHBO. The BO is usually expected to fail and is a signal to enter in the direction of the channel. Here are a couple of nice examples. Continue reading “1CHBO – 1st Breakout of a Channel”