A random collection of observations, anyone is welcome to join in.
- Chart structure is the most important indicator and provides the best information on market direction, upcoming speed bumps, and possible turns.
- The market can look random but it's not, it just looks that way because there are no hard and fast rules - only sentiment.
- Often the chart doesn't move the way you think it should. Different traders have different objectives. Some are working for clients and their only goal is to buy or sell a certain amount while trying to get a better average price than the 'end of day' price.
- Big traders have a tremendous advantage, they can move the market and as a reward will often get follow through.
- Traders can make money trading major reversals but they don't tend to be newbies, and yet that's the most popular strategy taken up by newbies.
- Most retail traders should stick to dip buying (or rally selling) in a trend.
- Higher high > higher low. Impulse leg > pull-back of around 40 – 60% > entry on reversal to continue with trend. (Lower low > lower high for down trend).
- Avoid buying INTO recognised resistance or selling INTO recognised support. Sure, the level may break but it might not. Wait for obvious battle lines to be cleared before looking for an entry (unless you really are big enough to move the market).
- For the same reason as above be wary of flat tops and bottoms in recent price action, price repeatedly being rejected at the same level says someone has a big order to fill and keeps reloading at that level.
- Expect today to be the same as yesterday - until it isn't. Look at any daily chart and you'll see most days are continuation days not reversal days.
- Assume that whoever controls the pivot controls the day - thus far.
(can you tell it's a 'slow as f*** day'?)