Continue reading...Capturing Trend Days
Trend days occur when there is an expansion in the daily trading range and the open and close are near opposite extremes. The first half-hour of trading often comprises less than 10% of the day’s total range; there is usually very little intraday price retracement. Typically, price action picks up momentum going into the last hour — and the trend accelerates.
Classic Trend Day – A large opening gap created a vacuum on the buy side. The market opened at one extreme and closed on the other. Note how it made higher highs and higher lows all day. Also, volatility increased in the latter part of the day–another characteristic of trend days.
A trend day can occur in either the same or the opposite direction to the prevailing trend on daily charts. The critical point is that the increased spread between the high and low of the daily range offers a trading opportunity from which large...
Last edited by a moderator: