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I'm trying to mark reasonable setups in a blank chart, and comparing with Al's one.
And I have a question about MTR setup.
This is my thought, but these are not marked in Al's one.
Could anyone give me some advice?
Thank you.
Hi Masato,
Check out my 2c (could be wrong)
[EDIT] - #1 is also L2 - and looks good for short in the hindsight
Hi mike,
Thank you for your answer.
There was a lot of things that I missed.
I need to practice to be aware of more detailed price action...
Hi Masato,
I think the #1 MTR attempt was a bit too early given all the prior strength by the bulls. I have a few notes on what to look for in MTRs:
- MTR Requirements:
- Must see countertrend pressure building with strong bar attempts (5-10 bars at least)
- TL break of tight leg or CH
- First such break more likely to be a minor reversal
- PB has at least 10 bars or 3 very strong bars
- After such strength traders begin expecting next trend resumption to fail
- Resumption attempt that retraces at least 33% PB of the minor reversal (22A 05:00)
- a 1/3rd retrace provides an adequate test of the prior extreme
- A 2nd reversal attempt with very strong bars suggesting major reversal coming next.
- Target is a swing profit for 1:2 AR since MTR only 40% to succeed
- MTR still most often evolves into big TR, not trend.
- MAG (bars leaving a gap above/below the MA)
- often results in final leg of trend and true MTR attempt (22C 04:54)
- any resumption will probably end up with FF and become either TR or trend reversal
- expect bull resumptions to fail around prior highs
- often results in final leg of trend and true MTR attempt (22C 04:54)
I think your #2 MTR attempt checks more of the above boxes, especially concerning MAG bars. The #1 attempt didn't go below the EMA yet and was more likely a test of the prior extreme so too early. As to why Al didn't mark #2 MTR, maybe the signal bar wasn't good (bull) and the next big bear bar was already too low into support, so now bears had to backup their BO statement with good FT but failed, so again MTR didn't take off.
Hope this helps,
CH
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Hi Mr. Carpet,
Thank you for the detailed explanations!
I learned a great deal, and I now have a better understanding of the reasons for determining whether these setups are reasonable.
I will study again the video you pointed me to.
