1337br wrote: Mon May 06, 2024 11:37 pm
Now I don't know for sure if I should just follow the trend (thick line) or wait for a reversal step by step.
as our curious friend showed an example of btc usd waiting for a reversal but did not sell because 1 colored dot was missing,
in the same trade a blue colored dot appeared in favor of the trend and if I had bought it it would have resulted in a gain
So I honestly don't know if the best way is to wait for the reversal or just follow the trend (thick line)
The zigzag lines will repaint, just like the dots. So then it comes down to the age old question, is that indeed the end of the trend?
When I see the big square arrow dot at the top, like in this BTC example, it looks to me like it will be a continuation of the uptrend, after a pullback. That is how I would approach it. If that pullback at the pink dot retests the top and makes another blue>pink dot below the big arrow, I would enter the sell feeling as though the downtrend is “more confirmed”.
The trader must come to terms with the fact that he will miss out on most of those first impulse reversal moves. Also keep in mind that if you had taken that sell on point #5 and had good risk management, the loss would have been easily absorbed and cancelled out by the gains in the ensuing buy set up that appeared.
The questions you raise are valid and is the trickiest part. Use the ADR levels to help (-15/+15%). Also check out the Legacy of Gann indicator. It is a free download on this forum and there are some accompanying videos for its use. My mt4 broker does not have BTC available on the weekend, but if I were to put a gann triangle on that sell set up in question, I would assume it would show a pretty small take profit level, giving me more pause that it is a reversal. That is another tool at your disposal for those types of trades.
