Completely changed so I don't look like I'm asking stupid questions. Re-read post 4. :whistling
What I am looking for is an ongoing sequence of candles in the time frame I'm trading - one minute in this instance - where the tops of the candles are lower, (in a down move), than the previous candle. .....
Hi Freeman,Hi Richard!
Thank you for sharing your wisdom with us. There is an statement (marked in blue)that got my attention in the quote before and a question arose: How do you relate your position size to the stock movement?
Thanks Richard,Hi Freeman,
There are two ways.
Firstly ATR will give you a good idea how much a stock moves within a given candle.
If you are trading on 3 min candles for example then you certainly don't want to have the same position size on a stock with an ATR of 60 as you would on a stock with an ATR of 15 as it tends to move more suddenly and violently and your risk is greater.
Always bear in mind that the intra-candle range can suddenly explode. By that I mean that the ATR might be say 12, but the next candle might range through 30.
The second way is actually quite simple but sounds complex. It depends on level 2 movement, T&S and buy/sell pressures, (what I call "Micro-Analysis"). As I've said before in this thread I am NOT going to go into how I use them in detail.
The nearest analogy I can think of is driving when you need steering and two or three pedals, some skills and knowledge and the skill to anticipate road conditions ahead. You obviously also improve with experience and practice. With time these become integrated.
By the way, all the old fashioned follow the market maker techniques are much less significant than they used to be, though still matter sometimes in some circumstances.
However, many stocks at many times are readable - not all of them - not all the time - on micro-analysis. If you can see the steady progression of price and can read its continuity on level 2, see the roadblocks and whether they remain under pressure, and several other factors, than you can gain a huge edge and sometimes see things which may be about to happen BEFORE they appear on a chart.
In this type of situation then the ATR comments earlier in this thread are trumped.
Of course most people can't be bothered with level 2 and some denigrate it without understanding exactly how and when to use it. They think that because old techniques no longer work so well then it' all useless - throwing the baby out with the bathwater.
It's not a be all and end all technique, it's a precision approach some of the time, not all, but my goodness, when it does come into play, it's a huge help and very profitable.
Hope that helps, Freeman,
Hi Mr. Charts,My pleasure
Here's another one today.
This is slightly different as I took the break out on a strongly trending stock which was on my hot list.
+49c per share on this one so $490 for a 1000 shares,$245 for 500 shares etc.