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Old 03-21-2007, 05:56 PM
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Re: Trend Day Confirmation

I don't predict but use measured move from a pattern to identify a trend and a length of that trend. Case in point, a breakout from a triangle, I expect it to be a beginning of a trend. If I'm wrong, I get stopped out, end of story. If it is a trend, then I have a length of trend in mind where it would go to. I don't know if it does but I know the probability that it will make it and not make it. This is the best I've seen and learn.



Let's take today's action and the chart above. I assume everyone agrees that ER2 (and possibly other eminis) are trending yes? I see it trending because it broke out from a double-bottom pattern. From past learned knowledge and experience, the measured move of this trend to go to 825. Will it go higher than 825? I have no idea. I know the higher probability that it goes to 825, after that, I have no stats to back my position so I exit before hitting the target. So I identify the trend early on when it breaks from a major/significant support or resistance level.

Now, if it breaks down before reaching 825, I have one clue to let me know that it may not make it and that is when it fails to make a higher high and starts showing a lower low. This tells me to either tighten my stops or just exit all together.

I know I'm being verbose but hopefully the message is clear.

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Last edited by torero; 03-21-2007 at 06:03 PM.
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