The bottom of the reversal structure - isn't it a post factum, i mean the structure has to form. and once it does, the bottom has been in play. One cant buy on the bottom (well, only speculated bottom, but not confirmed) before it happened.
True . That is exactly what we have with the dollar this morning. All trades are based on an expected move. Thus, all trades are speculation. Depending on one's tolerance for risk will determine one's entry. I like oversold entries on what i see as the bottom of reversal structure. Many prefer to buy after the break.
its all about risk, the same with fakeouts, and ERs. You can even be right, but the market will be irrational. On the other hand, once it is confirmed, it may be kinda late (although like some stocks you showed to me, they can run to the sky for a year or more:)
Discernment is the toughest part of the game. I am very much still learning myself. There are many ways to play as well from riding strong trends to catching strong reversals and many others. Because of fakeouts/ whipsaws, I like buying the oversold condition. They occur often after breakout but are not limited to. Besides, retracement is a natural site after a confirmed breakout. I am avoiding this by entering early and will often be exiting my trade as others are entering.
lets take a case. If you suspect a reversal, but you dont see a bottom yet, they say buy the fear. But will you buy on a red day with no confirmed bottom? Or on a green day?
Also, do you buy after a confirmation on the fibs, or prefer any fib level to buy automatically on any bounce off of it?
I never buy just because something is in the red. I need evidence or cause that a reversal is imminent. A double bottom/ top for me is a good place to start. But that alone is not enough. I have indicators, like most traders, that i use to help strengthen my conviction for a trade. Only after price action along with indicators are convincing do I consider a trade.