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Is looking at HH HL's or LL LH's a good way to define market structure ?
Under normal market conditions, using HH's / HL's / LL's / LH's in the conventional sense is going to cause you more problems than it solves. In ordinary conditions, try looking for unconventionalprice action as a framework for your trades. A simple explanation behind this is that swing highs/lows, and what type of orders will be resting there (if any), are easy to spot - and order clusters act like a magnet for price if underlying conditions are static.
In extra-ordinary market conditions, like for example these past two days, conventional price action can work very well. An even simpler explanation behind this is that when the sh!t is hitting the fan, the natural reaction of most short term speculators is to sit on the sidelines... "it's too choppy", or "I'll wait until the reaction is over", whatever. In these circumstances, conventional price action often yields excellent rewards.
Looking for "unconventional price action" ... can you be more specific ?
I think that looking for the typical HH+HL respective LL+LH sequence to define trend makes a lot of sense, however, I'd always make sure that price has balanced a bit before a new sequence starts.
Cjbooth's 6E method is all about that stuff, I believe.
context is where price is in relation to where it's been. looking at price now within the picture of where it's been. determining the important, key areas to those timeframes and trading at them and in-between them, reading the strength/weakness of the market, coming up with ideas to trade.
looking at higher time frames and plotting key levels to them - making a roadmap for intraday trading - and trading in a smaller timeframe within that picture.
i trade the 100k volume chart and the 405 min using the 10k volume chart, at important levels to the higher timeframes. but i also trade in-between these timeframe's areas using volume profile s/r + 10k reference (HHs, HL, etc.).
say if price is in a downtrend in the 100k, the market just hit an important support and price is now heading higher, if there is a good chance of price hitting a level that is 7 points higher, then i know that longs have higher probabilities until that level is hit. BUT the 10k could start to show that sellers are coming in by not making higher-highs anymore... doesn't mean it will go down, but it means that sellers are active enough to stop the HH pattern and the market could turn, failing to hit that targeted level, displaying weakness in buying power. that topping action in the 10k would be the equivalent of a turn in the 100k. what pattern IT COULD be making in the 100k, i use that for a trade idea - this is trading price in relation to where it has been, what it has done.
i don't think it's possible to trade one timeframe (this is what i'm calling it, but i'm sure there are many names for it).
i think people say AHG doesn't work, like they say all systems don't work, because they don't understand that it is never a guarantee, never certain. you got to cut the losers short and allow the winners to run. i'm never going to have 100% accuracy and neither will anyone else... it's impossible. you can't enter when a bar's close is above the previous bar's high... you're taking too much risk.
i'm wrong in saying this. it is possible, but i would be significantly reducing the probabilities i could easily have on my side if i were trading within the context of higher timeframe action. it's about probabilities.
