Back to trading today having read the first chapter of Al Brooks Reading Price charts bar by bar. Really surprised at how dense it is, I thought a lot of reviewers were over exaggerating but it has taken me 3 days to read 50 pages properly (and I haven't even written my my notes). It has definitely helped but as with all new information I have found it's confused me and my method while I digest it, so no trades this morning or this afternoon. I spotted stuff that meet my criteria but I chickened out. I hindsight it is always easy to spot trades one would have liked to have taken but in this case it wasn't that I didn't see them (as I was just looking for price stretches) it was the fact that there was too much S&R on my chart (admittedly that I put on) that put me off. Had I kept my chart clean like Brooks and traded price action I would have had an easier/less stressful time of it. I don't think it's massively important to place the would be trades in the journal today as they're all pretty obvious.
I think the best thing for me to do today is to write up my notes on what i have learnt, this will hopefully clarify some stuff. This I have done and the fog is starting to clear.
Notes:
One thing I would like to note that I observed today was to do with a when a S/R level has actually swapped roles / changed polarity.
I noticed that once you get a floater (a bar that completely detaches itself from the level) above or below the level , that area seems to be broken. (It may require 2 floaters, still a work in progress)
Here's some examples:
1. Price tests 252EMA then bar floats above it = 252EMA now support
2. Price tests 252EMA then bar floats below it = 252EMA now resistance
3. Price tests D1 S then bar floats below it = D1 S now Resistance
4. Price tests 1.35 then bar floats below it = 1.35 now Resistance
I think the best thing for me to do today is to write up my notes on what i have learnt, this will hopefully clarify some stuff. This I have done and the fog is starting to clear.
Notes:
One thing I would like to note that I observed today was to do with a when a S/R level has actually swapped roles / changed polarity.
I noticed that once you get a floater (a bar that completely detaches itself from the level) above or below the level , that area seems to be broken. (It may require 2 floaters, still a work in progress)
Here's some examples:
1. Price tests 252EMA then bar floats above it = 252EMA now support
2. Price tests 252EMA then bar floats below it = 252EMA now resistance
3. Price tests D1 S then bar floats below it = D1 S now Resistance
4. Price tests 1.35 then bar floats below it = 1.35 now Resistance
Nice to see your reading Brooks! A lot of people will claim that its too dense and poorly written to be useful, although I would disagree. But as I mentioned previously, I think the Nine Transitions guy does a great job of turning it into meaningful and useful information, with nice charts included as well! That is where I spent most of my time learning bar by bar price action.
ReplyDeleteAs for the MA's - admittedly, Brooks and Nine Trans guy both use the 20 EMA in their trading. However, if I had to wager, I'd say its more as a frame of reference than anything else, and even now, Nine Trans guy took it off his chart all together, using trendlines as S/R instead. My first mentor told me the only thing I needed to get good at was drawing horizontal lines. Just a thought for the day about MA's...
http://ninetrans.blogspot.com/2011/01/four-trades-off-nine-transitions.html
ReplyDeleteThat's one of the best pages in any blog I've seen.
Good to hear from you! Ever since you mentioned Al Brooks and Nine Trans I've been working on them. That BS trading pdf you recommended was also brilliant. Must admit I tried working through nine trans for a bit but realised I was missing much of what he was talking about because I didn't know the names of the setups and his price action references ( but this page you mention looks great!). Probably could have persevered but thought it might be better to go to the "source" and then re-visit once I'm more up to speed.
Delete