Some questions received through email:
What's a failure swing?
When Pivot 4 taking out Pivot 3.
What's a point of make or break?
A point to which price actions converged before making a sudden move to either up or down. This tends to happen when the market is waiting for an anticipated trigger/catalyst before its next move. In the case of the current US market, the announcement following the upcoming FOMC meeting seems to be what traders are waiting for.
The last make or break point I spotted for KLCI: KLCI: Make or Break!
Is it possible to know beforehand the bias of such a sudden move?
From my experience, the bigger time frame tends to provide a very good guidance. However, it is difficult to trade it risk-conservatively when price actions are nearly converged. If you want to bet on a formation on a bigger time frame, you have to place your bet before price actions converged within a lower time frame. In the case of the S&P 500 futures, shorting at Pivot 3 on the EoD chart, which gives you a lot of room to trail stop and to set a good profit floor.
No comments:
Post a Comment