For now I'm concentrating on the H2/L2 that are near the EMA (as suggested in Gary's notes from the webinar). But it's odd that we see two failures on his chart. But then again if it worked 100% then brooks would be a billionaire right?
There must be some other factors involved in his decision to take these trades.
I was thinking about L1, L2, L3... labeling some weeks ago.
IMO it is not possible, as you have to define the start (L1) and whether there is an L3 or a new L1 etc. How about variants? There are no clear definitions about all this things. So you always would produce a lot of wrong labels, and that is worse than no labels.
I wrote a LegHL indicator (at NT indi section) that does a basic labeling and has a choice how to handle outsidebars. Thatís helpful for a beginner or for some trading strategies like EMA G. As you read the chart bar by bar you will find them very easy after a few days/weeks without indicator.
Just took a CL L2 trade, got 13 ticks. Note that the L2 came just after an HVC bar.
I'm doing this on sim until I can do it consistently.
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PS: I decided to do away with all the special indicators and go back to my trusted & proven setup on Tradestation. Unfortunately tradestation charts and annotations suck. And since I trade with the NT DOM I don't have chart markers on my TS charts so I have to mark them myself..
Thanks for the good words cunparis. I'm by no means proficient with these patterns yet but it seems that the more I read and the more charts I watch the more I am able to spot patterns in real time.
I copied your chart and marked it up a bit. I still don't know how to spot Low2/High2 setups with very good accuracy. I believe the key is the scope of the setup and the environment of trade. For example I know Brooks says to look for High2 setups in an up or sideways market. One thing he didn't quantify with that is the extent of the sideways market. On your chart (as I've marked) I believe the sideways movement is too tight to be trading High2's. Again that's just my opinion as I'm still learning this stuff as well but it definitely seems to be sinking in.
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I think I'm at step 1.5, starting to recognize patterns but still missing em and also thinking they are there when they're not. As far as programming this stuff I don't think it could be done as I believe the context of the setups is just as important as the setup itself. Plus you've got to keep in mind that sometimes the Low2/High2 setups are intrabar and don't actually present themselves on the chart.