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Hello everyone,
I just saw the video on ledges, 18D and a lot of questions popped up in my mind. If you could kindly help me in the matter, that would be highly appreciated.
First of all, I found ledges in only one video that is 18D. Does Al cover it in a bit more detail somewhere else?
Second, from what I understood, any triple or more tops(approximately I hope) should act as a ledge. From a previous post regarding ledges answered by ludopuig, I learnt that ledges need not be consecutive. Considering it is a pretty high probability setup(80%), naturally I got very interested and did some back-test on the charts I follow. It works extremely well.
However, my question is when should I conclude that the said ledge is not working anymore(20% event)?
Since, ledge areas are tested some time in the future, at what point should I conclude that the 20% event has/will be taking place?
Even more so, when the ledges are pretty far apart in the time-frame(creating ledges on a higher time-frame charts), one should expect the test of said ledge might take even further time. So, do we even know that the ledge might/might not work?
Or should we trade the charts as it is using normal price action and consider that ledges as mere magnets and we know that the magnet worked only when the magnet is tested?
I have dragged this question long enough, but I would like to attach a chart to solicit your inputs on the matter.
This ledge(approximate) was created on 30th July 2021 at around 34500 on a 5 minute chart and the market ever since has risen to about 36300 and did not test the ledge yet. That's a lot of time. So, if the ledge does not get tested anytime soon, at what point could or should I have concluded that the 20% event has occured?
Finally, my last question is, ledges are horizontal wedges. So, is it expected that the wedges behave similarly to ledges? This question occurs to me as, according to Al's teachings, we trade trading ranges and broad channels similarly.
Sorry for the long post. Thanks again for all the help.
First of all, I found ledges in only one video that is 18D. Does Al cover it in a bit more detail somewhere else?
Only in one video as far as I remember.
Second, from what I understood, any triple or more tops(approximately I hope) should act as a ledge.
You need a minimum of 4 bars, not 3, and they have to have identical highs or lows.
However, my question is when should I conclude that the said ledge is not working anymore(20% event)?
2 more days. After that the ledge loses influence.
Even more so, when the ledges are pretty far apart in the time-frame(creating ledges on a higher time-frame charts), one should expect the test of said ledge might take even further time.
Every ledge works in its own time-frame, so deal with them separatedly.
So, do we even know that the ledge might/might not work?
Or should we trade the charts as it is using normal price action and consider that ledges as mere magnets and we know that the magnet worked only when the magnet is tested?
Yes, ledges are rare and you should keep using regular PA analysis.
This ledge(approximate) was created on 30th July 2021 at around 34500 on a 5 minute chart and the market ever since has risen to about 36300 and did not test the ledge yet. That's a lot of time. So, if the ledge does not get tested anytime soon, at what point could or should I have concluded that the 20% event has occured?
With the above said you see that this is not actually a ledge because it only has 3 bars and they have not identical lows tho in charts using pips (with 10 pips per point) having identical highs or lows is almost impossible so, in those situations, you can give 1 or 2 ticks of difference on the basis that something that resembles a ledge will actually work as a ledge.
Finally, my last question is, ledges are horizontal wedges. So, is it expected that the wedges behave similarly to ledges? This question occurs to me as, according to Al's teachings, we trade trading ranges and broad channels similarly.
Nop, they are fundamentally different and you can see that in the way you trade them: Nobody would take a wedge bottom if they had an 80% prob that the MKT would come back to their entry. Actually, they would be doing the exact opposite, shorting.
If you have access to the encyclopedia, I suggest going to the ledges section in which you will see many more charts than the used in the video course and you will be able to fully grasp the concept. By the way, I strongly recommend to do that after each course's section.
Thanks a lot for taking the time to patiently answer all the queries. Really appreciate the help.
No, I do not yet have access to the encyclopedia as I have not yet finished the 60 days waiting period after subscribing to BTC.
If you have access to the encyclopedia, I suggest going to the ledges section in which you will see many more charts than the used in the video course and you will be able to fully grasp the concept. By the way, I strongly recommend to do that after each course's section.
Thank you for the suggestion. I will, once I am eligible to subscribe that.
Good luck in your trading and stay safe!
