Backtesting and analysis of chart history helps improve your trading. Some traders overcomplicate things and use dozens of indicators, on the other extreme - there are fans of clean charts. The truth is, as always, in between.
In this analysis I will demontsrate some of my usual tools, that proved to be very helpful. Starting from a clean chart - and adding different TA tools step by step, that support every entry shown on the main chart, as well as the overll logic along the price action.
So, let's start. You will find a lot of screens and supporting descriptions in the updates to this post.
Cheers.
In this analysis I will demontsrate some of my usual tools, that proved to be very helpful. Starting from a clean chart - and adding different TA tools step by step, that support every entry shown on the main chart, as well as the overll logic along the price action.
So, let's start. You will find a lot of screens and supporting descriptions in the updates to this post.
Cheers.
Comment:
Always keep in mind, that counter-trend trading is more risky, as the main trend tend to last longer than you may usually expect. Here is the alternative for this point of time (the easiest one that comes to my mind)
Comment:
Correction starts. You will never know when the corrective is complete.
But there are some guidelines/ typical patterns, that I would recommend to study.
They are well defined and explained in the Elliott wave principles.
But there are some guidelines/ typical patterns, that I would recommend to study.
They are well defined and explained in the Elliott wave principles.
Comment:
An important note to the explanation on the impulse
Comment:
The chart is logarithmic. I tend to check crypto and growth stocks charts on both regular and log scales, especially on senior time frames
Here - on the regular chart to the right side of a snapshot - the assumed wave A retraced perfectly by 50%.
No trades, keep patience. In hindsight, the correction in AAVE took 93 days)))
Here - on the regular chart to the right side of a snapshot - the assumed wave A retraced perfectly by 50%.
No trades, keep patience. In hindsight, the correction in AAVE took 93 days)))
Comment:
Above - added the marking for the corrective structure - "abc". At this stage it is recommended to plan for the zigzag - as it is the typical wave pattern for the second wave.
Comment:
Comment:
Comment:
Comment:
Comment:
Comment:
Comment:
Comment:
And the final hint: RSI is a leading indicator. I recommend monitoring it every time you look at the chart for the entries/ exits.
This time - you may draw a flat channel on RSI - and notice, that the breakout and retest actually happed earlier than on the price chart.
This time - you may draw a flat channel on RSI - and notice, that the breakout and retest actually happed earlier than on the price chart.
Comment:
So, we have covered all the entries on a "teaser page".
Hope, you find this analysis useful and you have discovered new ideas - where to practice more and unleash your analytical skills)))
Have a nice week-end, friends!
Hope, you find this analysis useful and you have discovered new ideas - where to practice more and unleash your analytical skills)))
Have a nice week-end, friends!
Let us assume, you have a process of identiying specific signals to plan and initiate a trade. In our case this signal is a strong impulsive move in the direction we anticipate.
Don't force the trade, every impulse is followed by a correction. Rushing in early will lead to an unpleasant drawdown )