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Re: Reversals

Jimmy, Sun Sep 24, 2017 10:27 pm

For conservative counter-trend trading with actual reversal confirmation I will simply use either a:

  • Trendline break in opposite direction of trend after an "extreme" signal from Chaos Visual Averages
  • Or trendline break in opposite direction of trend after TDI signal cross
  • Or 9 period RSI trendline break (trendline drawn on RSI) on 4 hour chart

For aggressive and quick retracement (mean reversion) scalping I will take counter trend trades whenever price "bursts" and touches:

  • The Monthly, Weekly, Daily and 4H 200 Moving Average
  • The Monthly, Weekly, Daily and 4H major horizontal support and resistance lines
  • Whenever price on the 1 hour chart touches or breaks through the outer Bollinger Bands on settings 20, 3

The above techniques are quite risky in strong trends not to mention psychologically draining, but the trade off is you can easily make a fortune trading these techniques.

Example of an aggressive scalping chart I use on the 1H timeframe for mean reversion trading.

Once the outer Bollinger Bands 20, 3 have been touched during volatile movements a gray dot will display on that candle I'll go short.
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