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I look for a breach of an outer line, and a back test, then I...

  1. 2,829 Posts.
    I look for a breach of an outer line, and a back test, then I analyse the pattern to see if I can work out the new fork, and therefore the new trend. Then i look at the small scale patterns around the lines to figure out (understand) what is happening. Then I try to work out the probabilities, and the points at which those probabilities must be wrong. After that, if there is something left over with a good enough risk/reward, I will either get the order push button thingy out, or I will put in a limit order with a specific entry, with an "if done" stop (where I conclude that my analysis must be wrong), usually behind specific structure, and a profit target 'OCO' order linked to the stop

    This is a current CAC showing how I would trade break up after a failed short.
    Photobucket
 
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