Support and resistance are important levels where lots of buyers and sellers are willing to trade a security. Although single lines look nice on a chart, levels need to be seen as zones. Like Al Brooks is saying here “One of the most useful rules in trading is that if something resembles a reliable pattern, it will likely behave like the reliable pattern. In any case, nothing is ever perfect or certain, so close is usually close enough.”
Multi-Bar Reversals for the Reversal Signal Bars Indicator
PAReversalSignalBars for NT 8
Multi-Bar Reversals (MBR) are reversals, where the market tries to reverse over the course of a couple of bars. For a bull reversal there is often a strong bear breakout followed by a strong bull breakout. Often there are a couple of pause bars in between the two breakouts or each breakout can be spread over several bars. It is best if the reversal up is bigger than the sell off down.
Sometimes there is a reversal bar or pattern (a two or three bar reversal) on a higher time frame, e.g. the 30 min chart for a multi-bar reversal that takes place during six bars on the 5 min trading chart.
Entries on a MBR should be taken with some discretion though. If the MBR is large it is better to take a pullback entry. Advanced entry strategies are to BB and SA with a Signal Bar or with limit orders.
All Reversal Signal Bars & Patterns
Continue reading “Multi-Bar Reversals for the Reversal Signal Bars Indicator”
More Signals for the Reversal Signal Bars Indicator
The Reversal Signal Bars indicator (for NT 8) now identifies over 15 different signal bars and patterns for possible reversals. We’ve added these three signals:
Inside Inside failed Breakout – II fBO
An Inside Inside Pattern are two consecutive Inside Bars. The pattern is often a trading range or triangle on a smaller time frame and an area of equilibrium. A breakout often fails and tries to reverse back into the II pattern.
The stop entry for a bull II fBO Signal Bar is one tick above the high of the bar and the stop loss is one tick below it.
Continue reading “More Signals for the Reversal Signal Bars Indicator”
Updated Indicators – Reversal Signal Bars, Buy Sell Pressure
The Reversal Signal Bars indicator (NT 8) now shows Supporting Volume, compared to prior bars as well as possible Entry Bars and Breakout Bars after a Reversal Signal Bar.
Continue reading “Updated Indicators – Reversal Signal Bars, Buy Sell Pressure”
Trade the 1st Pullback after a Wedge – the W1P!
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!”