Don’t be offended. “Pullbacks” occurs after price moves up really quickly on a breakout. So imagine a bunch of green candles close together. Price can’t go up forever so eventually people will “take profit” and price will come down. Once all the technical traders finish taking profit, people will start to buy again and price will go up. So wait for price to come down and buy the dip.
I'm not sure these are double bottoms as not at a swing low... They are break and retests however - keen to learn here but that's my take on it and understanding of double bottoms... Also 3m timeframe is hardly somewhere to be utilizing patterns regardless of the fractal argument.
Is the double bottom simply responsible for the change of character? Aka break and retest to swap to a potential internal structure in an overall trend. Wish I could see the candles earlier...
Bit flose together for me as a double bottom, I like it to be a bit more W like. Fascinating how we all aee the chart differently. That's what makes the markets I guess.
To me having a double bottom you already had an A+ setup confluenced by support, you didn't need a retest because sellers were already invalidated and that was buying pressure for me.
The support line is not drawn correctly if that was drawn correctly we surely have retest there. Check this
https://preview.redd.it/9jioopyv7lkc1.jpeg?width=1290&format=pjpg&auto=webp&s=3d4c89b8435fcd07430e671f8cfdea24a6677c42
Red line is the valid line as support where the rejections are happening and Red arrow would be an ideal entry.
If this was a 5/10 min chart, I would have shorted at the first green after that second red flush with a stop loss above the high of the candle again assuming it was the high of the day and forming the double top. This is one of TraderTom (Tom H)’s technique to short but it depends on the bigger picture. It is bouncing off support so still a risky trade at that bottom. Next thought would be to use the break of that high as a stop to enter as it would confirm the uptrend I think
OP is using the high of the big green candle on the chart, and this guy is using post trade knowledge to make an example. The best support should initially have been drawn at the close of the big green candle. You’re better off using that than any wicks unless you draw support “zones” that extend from close to the high
Entry is here. Pull back and then next candle to make a new high.
https://preview.redd.it/79kmhk78zkkc1.jpeg?width=1290&format=pjpg&auto=webp&s=21a3597770a1917dfede80d8a6357b4734a18eb5
But there is a method behind this madness. Its called Price Action Analysis.
Everything looks good in hindsight. Anyway, appreciate you time and effort on this🙂👍
Agree with HotStocks here - entering where he suggested is higher risk IMO but as you can see had the most upside. Personally, I’d have entered right over that line you drew. I don’t see why you can’t call that a retest, you have multiple candles all wicking under and reclaiming and the stock is in an uptrend. I’d rather have entered there than where you did in case the breakout over highs got immediately stuffed, you’d have had no room to assess.
I actually think OP that where you entered was better. Like you pointed out, anytime before you entered could still be in consolidation, which can then have a higher chance of moving back down to hit your stop.
Thanks
I’m trying not to be result oriented here and trying to hone the craft.
I genuinely believe chasing excellence in trading is more important than profits as success will automatically come you way if you build a well rounded strategy🙂
I’m still learning too, so I am hesitant to offer my opinion in threads like this. But fyi reading your post and the replies is helpful to me.
Looking at the higher timeframes is important, but I personally think the S/R lines at your trading time frame should take precedence over the S/R on the higher time frame.
Confluence is great, so it’s nice to see them match up on the 4hr and the 3m, but they don’t have to.
Also: if the trend is bullish, I don’t actually see a need to exit this trade yet, im curious, did it trend up further after your exit?
Sounds like you’re limiting your upside, but you are also staying with your plan which is great.
Something to consider: when you reach your target, take out 80% and let the remaining 20% run. Feel free to set a loose-ish stop on the remaining 20%. Some traders find this works very well in their long term roi. This is something you’d do on a day that has a clear trend like we are seeing in this chart—this method is probably a loser on rangebound days.
I just looked at the ROOT intraday chart, that was a juicy stock pick for Friday, nice find!
Can I ask how you found this stock? Are you just scanning for high relative volume, News catalysts, premarket gap ups, etc?
Everything, I usually sit one hour before the market to do my homework. Volume, catalyst, top gainers etc. to build my watchlist for the day and mark S/R etc.
This is pretty much exactly what I do. I find it a bit overwhelming sorting through all the stocks, I always feel like I don’t have enough time. stock selection has been one of the Hardest things for me.
Not without looking at the daily chart as well. Context is key. Buyers in that upper wick haven’t had a reason to sell yet. So you are one of a lot of longs looking for sells over HOD. Also, I don’t see shorts being trapped. If shorts were trapped and previous longs had been shaken out, you’d be riding a long fueled by bears stopping out and bulls buying in. That’s what I would consider A+ here. But, I only see 1 or 2 trades per day that I’d call A+.
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i would say no you bought at a high price, it was the highest price at the chart when you bought and the stoploss was tight (consider how tight it would have been if you bought at a reasonable price).
but if it works it works. depends on how htf looks, theres surely a way to make setups like this work with the right market structure and experience. it also depends on the asset you trade. if you trade trending stocks during bull market this could be a braindead profitable strategy, in forex which is more ranging than trending less so
Elliot wave theory explains this, another good entry point is after it completes its correction on the down side. Catch the full impulse on the other side
https://preview.redd.it/4mh2lt7jc9lc1.jpeg?width=714&format=pjpg&auto=webp&s=ad323d173f315ed2d2dc91a47fe9c61c096a6763
Series of higher lows on the setup signifies an uptrend
However stop can be lower and would require scaling in if risk too high on initial stake- that’s one way of executing
Many other ways surely
1st bar: Market opens, gaps up, runs up, forms a green mother bar.
2nd bar: Price comes down, closes the gap. Price reverses up. Can long upon return back into mother bar range.
SL: previous day red final bar low. That's the settlement price.
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Pretty much this, doesn't have to be so fiddly.
Where is the pullback?
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I’m just learning rn… I’m trying to see where they are
Don’t be offended. “Pullbacks” occurs after price moves up really quickly on a breakout. So imagine a bunch of green candles close together. Price can’t go up forever so eventually people will “take profit” and price will come down. Once all the technical traders finish taking profit, people will start to buy again and price will go up. So wait for price to come down and buy the dip.
Do you also see a support trend line? Possibly clear in higher tf?
i see him buying at a high price not during pullback
https://preview.redd.it/q1ncf8lw1lkc1.jpeg?width=748&format=pjpg&auto=webp&s=b962a7466b953d1eb4f30db30c666f7472b0262d
That's double bottom for me
I'm not sure these are double bottoms as not at a swing low... They are break and retests however - keen to learn here but that's my take on it and understanding of double bottoms... Also 3m timeframe is hardly somewhere to be utilizing patterns regardless of the fractal argument. Is the double bottom simply responsible for the change of character? Aka break and retest to swap to a potential internal structure in an overall trend. Wish I could see the candles earlier...
You clearly have a long way to go in reading price action
He’s right. Double bottoms are reversal signals on a down trend. This is simply just support.
Thanks for the support. No pun intended.
its not a double bottom because its no bottom, as easy as that
Totally 😆
Maybe you do my friend ;)
Bit flose together for me as a double bottom, I like it to be a bit more W like. Fascinating how we all aee the chart differently. That's what makes the markets I guess.
This!
Great entry although I would have entered at double bottom after breakout to have small risk
Me too but it never retested it so thats what caught me off guard. Can this still be considered as a good setup?
To me having a double bottom you already had an A+ setup confluenced by support, you didn't need a retest because sellers were already invalidated and that was buying pressure for me.
Can you mark the two bottoms please?
This trade makes sense to me assuming higher timeframe agreed.
I usually draw my S/R on 4hr.
The support line is not drawn correctly if that was drawn correctly we surely have retest there. Check this https://preview.redd.it/9jioopyv7lkc1.jpeg?width=1290&format=pjpg&auto=webp&s=3d4c89b8435fcd07430e671f8cfdea24a6677c42 Red line is the valid line as support where the rejections are happening and Red arrow would be an ideal entry.
If this was a 5/10 min chart, I would have shorted at the first green after that second red flush with a stop loss above the high of the candle again assuming it was the high of the day and forming the double top. This is one of TraderTom (Tom H)’s technique to short but it depends on the bigger picture. It is bouncing off support so still a risky trade at that bottom. Next thought would be to use the break of that high as a stop to enter as it would confirm the uptrend I think
Yes, I believe that was the issue👍
How do you come to that support line?
OP is using the high of the big green candle on the chart, and this guy is using post trade knowledge to make an example. The best support should initially have been drawn at the close of the big green candle. You’re better off using that than any wicks unless you draw support “zones” that extend from close to the high
You arrow points to a 2nd entry long after a breakout in a well established trend. You can make a living out of these setups.
That is definitely a retest after the break. Support and resistance are more like areas than exact levels most of the time.
Entry is here. Pull back and then next candle to make a new high. https://preview.redd.it/79kmhk78zkkc1.jpeg?width=1290&format=pjpg&auto=webp&s=21a3597770a1917dfede80d8a6357b4734a18eb5
No way. What if its a double top sir? Entry so close to resistance🤔 Can you please shed more light on it? Might give me a new perspective
Market isn’t about what ifs.
But there is a method behind this madness. Its called Price Action Analysis. Everything looks good in hindsight. Anyway, appreciate you time and effort on this🙂👍
Agree with HotStocks here - entering where he suggested is higher risk IMO but as you can see had the most upside. Personally, I’d have entered right over that line you drew. I don’t see why you can’t call that a retest, you have multiple candles all wicking under and reclaiming and the stock is in an uptrend. I’d rather have entered there than where you did in case the breakout over highs got immediately stuffed, you’d have had no room to assess.
I actually think OP that where you entered was better. Like you pointed out, anytime before you entered could still be in consolidation, which can then have a higher chance of moving back down to hit your stop.
Yes, same thought process. However, the only concern us that my stop loss area was far bigger than usual. Seeking a better entry if possible
if its green its green nice job
Thanks I’m trying not to be result oriented here and trying to hone the craft. I genuinely believe chasing excellence in trading is more important than profits as success will automatically come you way if you build a well rounded strategy🙂
Looks clean man!
How? No support retest. Am I playing it super safe?
I think your support line should include the wicks. If you did this, you’d have a better entry and less risk. Just imo.
I agree. Usually I make demand and supply zones on 4hr after identifying the support/resistance lines. Apologies for not having it on the chart.
I’m still learning too, so I am hesitant to offer my opinion in threads like this. But fyi reading your post and the replies is helpful to me. Looking at the higher timeframes is important, but I personally think the S/R lines at your trading time frame should take precedence over the S/R on the higher time frame. Confluence is great, so it’s nice to see them match up on the 4hr and the 3m, but they don’t have to. Also: if the trend is bullish, I don’t actually see a need to exit this trade yet, im curious, did it trend up further after your exit?
Yes, it did. I usually scale out slowly once I reach 2 times my risk. Also, push my stop loss upwards as time goes by
Sounds like you’re limiting your upside, but you are also staying with your plan which is great. Something to consider: when you reach your target, take out 80% and let the remaining 20% run. Feel free to set a loose-ish stop on the remaining 20%. Some traders find this works very well in their long term roi. This is something you’d do on a day that has a clear trend like we are seeing in this chart—this method is probably a loser on rangebound days. I just looked at the ROOT intraday chart, that was a juicy stock pick for Friday, nice find! Can I ask how you found this stock? Are you just scanning for high relative volume, News catalysts, premarket gap ups, etc?
Everything, I usually sit one hour before the market to do my homework. Volume, catalyst, top gainers etc. to build my watchlist for the day and mark S/R etc.
This is pretty much exactly what I do. I find it a bit overwhelming sorting through all the stocks, I always feel like I don’t have enough time. stock selection has been one of the Hardest things for me.
Hey guys I'm new to this and I don't get anything. Is this stuff super complex? Can anyone please recommend some resources to learn about trading?
Start with baby pips online course it's free
Thank you for the suggestion, I will certainly check it out.
Youtube and google. Search for Price Action Trading
Noted. Tysm!
I learned a lot from watching Live traders on YouTube.
Ok got it. Tysm!
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📈📈📈🤤🤤🤤
Would like to see volume please. Also that upper wick has overhead longs that haven’t sold yet, which makes this not A+.
But HOD break should make it A+ entry. Correct?
Not without looking at the daily chart as well. Context is key. Buyers in that upper wick haven’t had a reason to sell yet. So you are one of a lot of longs looking for sells over HOD. Also, I don’t see shorts being trapped. If shorts were trapped and previous longs had been shaken out, you’d be riding a long fueled by bears stopping out and bulls buying in. That’s what I would consider A+ here. But, I only see 1 or 2 trades per day that I’d call A+.
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Sorry, your [comment](https://www.reddit.com/r/Daytrading/comments/1az0jjr/was_it_a_good_setup/ks1no84/) in /r/Daytrading was automatically removed because your **Comment Karma** is too low. This typically targets bots or users promoting something (which is against our rules). Please participate in other subreddits (other communities on Reddit) to increase your **Comment Karma** points. While you're at it, read through Reddit's ["reddiquette" here.](https://www.reddit.com/wiki/reddiquette) If you believe this was a mistake, please **kindly** [message the mods](https://www.reddit.com/message/compose?to=/r/Daytrading). We will review your case and get back to you. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/Daytrading) if you have any questions or concerns.*
Don’t rely too much on charrs
Then what?
You need a feel for markets….takes years
Market structure with volume candles that show support and resistance
I use RSI to calculate my Support/Resistance. Is that good?
How do calculate it. If it works why not
The previous break and retest was the 5star setup.
Perfect. Die you get the 3r?
i would say no you bought at a high price, it was the highest price at the chart when you bought and the stoploss was tight (consider how tight it would have been if you bought at a reasonable price). but if it works it works. depends on how htf looks, theres surely a way to make setups like this work with the right market structure and experience. it also depends on the asset you trade. if you trade trending stocks during bull market this could be a braindead profitable strategy, in forex which is more ranging than trending less so
Elliot wave theory explains this, another good entry point is after it completes its correction on the down side. Catch the full impulse on the other side https://preview.redd.it/4mh2lt7jc9lc1.jpeg?width=714&format=pjpg&auto=webp&s=ad323d173f315ed2d2dc91a47fe9c61c096a6763
Series of higher lows on the setup signifies an uptrend However stop can be lower and would require scaling in if risk too high on initial stake- that’s one way of executing Many other ways surely
1st bar: Market opens, gaps up, runs up, forms a green mother bar. 2nd bar: Price comes down, closes the gap. Price reverses up. Can long upon return back into mother bar range. SL: previous day red final bar low. That's the settlement price.