Wednesday, August 10, 2011

Large inside day

A small inside day would normally be a poor day but given today had a 40+ point range, riding a couple of swings can be fruitful. The trick on days such as these is to recognize a failed breakout and exit and possibly reverse off it.

The right move on the AM trade was to reverse long off the fBO on b20 and reverse short again off b60. The trouble with trading swings on trading range days is that a trader needs to develop flexibility regarding possible fBO. If I had correctly read b60 as a fBO signal, I would have reversed short instead of finding reasons to go long all the way down.


  1. Good posts. Apologize in advance for a barrage of questions / comments. Appreciate your thoughts.

    1. What does MW stand for near bar 12 & BT stand for in Bar 67(gloassary does not have this information)
    2. When we have a large gap down, not sure why you took the 1Rev @ bar 2.
    3. The arrows marked at the signal bars right? For example, the arrow marked in bar 2, means you bought 1 tick above the high of the bar @ bar 3.
    4. I am curious are you using the bar lows as the stop? For example, your stop for the 1rev @ bar 2 is ~ 7 points. In that scenario, Is ur T1 still 4 points? Have you adjusted your scale out targets with the higher volatility in context of Risk / Reward? Or you are trading these setups with a fixed stop like 3 point stop irrespective of the size of the bar?
    5. Say you are risking 3 points for a setup. Would your T1 be @ 3 points (R:R of 1) or T1 be at 6 points (R:R of 2). Once you get T1, you move stop to BE?
    6. Curious why you didnt take a FBO @ 58 bar? Because at that point intraday trend was up?
    7. G2 setup @ bar 70.. Your entry would have been @ 36.75 & after the entry bar closed ur stop would have been at 32.75. So if you had gotten stopped it would be -4. I am curious how you got -2.25? Any specific rule to move stop closer or BE?
    8. FH1 and Fh2 in bar 68 & 72. Curious why you didnt short especially when FH1 happened.
    9. Bar 113 where you had +2, -1, as per rules, if your T1 is 4 points you would have gotten it. Entry was 1131 and it went to 1135 (assuming u got the 35 fill). Curious why you didnt hold for +4?

    Thank you and have a good evening.

  2. 1. mW = micro Wedge; added to glossary
    2. When the reversal bar is strong in the first few bars, I usually take it.
    3. Yes
    4. On large days, I often use 20K volume charts or 1m chart to determine stops
    5. Basically, yes
    6. B58 was a bull bar, but I should have taken b60
    7. Entry/Stop was on Volume or smaller TF chart
    8. I should have. Mistakes.
    9. Again, off Vol and 1m chart