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I have mentioned in this thread one of the best trend continuation price patterns is the ABCD retrace. It formed this morning and again worked for the 21 tick gain. Learn to see this pattern price rarely fails to make a new low or high on these patterns
1508 chart, see my text showing the pattern
the caclulation again is
the low of point A = 1.4252
the high of point B = 1.4267
point C does not make a new low - VERY IMPORTANT IT DOES NOT
take the difference between points A&B = 15 ticks
15 divided by 2 = 7.5, round up to 8
add the difference to the point B high 1.4267+8= 1.4275
the candle at point D closed at 1.4275
Another example of tick charts - the important thing is to learn the setup look and then trade your chart. these patterns form on all charts just not always at the same time
That HL after a LL in a downtrend is the signal to look for the ABCD
In an ABCD retrace it is THE RULE that that pont C cannot make a lower low or a higher high if we were in an uptrend
When you see a swing fail as in point C and you are in a downtrend you do the math and wait and see if the ABCD setups. A candle cannot close above in this case 1.4275 or the signal is void and then you have to wait for a LL followed by the retrace
Just finished reading the entire thread and liking what I've seen so far!
I think the only thing I am hazy on throughout the read through is the entry itself. The main components for entry appear to be he trigger lines, and the price bars(doji etc).
So is the logic that, once your 1508 is correct, and you get a good pullback on your 377......
you then just WAIT until you see a doji, spinning top, or Hammer
Next observe the width of the trigger lines
Enter on the bar that will break through the triggger lines
I assume the entry bar does NOT have to come directly after the doji?
With the picture I'm quoting, it looks like there is a doji all the way at the top of that swing before the entry, and at that point the trigger lines are a bit wide it appears? Then there is a comment, "candle closing below cloud." Should all entry bars close below the cloud?
I'm just generally confused on how the actual entry is made. I would appreciate feedback from CJ or anyone who understands the entry.
yes all short entries must be a bar closing below the cloud, and above it for a long
The trigger lines and super trend indicators are mainly filters to prevent getting in to early, wide trigger lines will usually cause the setup to fail
there must be a spinning top, doji, or hammer bar at or near the retracements end, however the actual entry bar will sometimes be several bars later as you discretionally evaluate the filters
