Consolidation after a trend day

[Soultrader]

Continuation of this thread: Identifying the %TREND

Always watch out after a powerful trend day. The markets will trend 30% of the time and consolidate 70% of the time. Making money in a trending market is easy. Consolidation is what makes new traders broke.

The %TREND is useful to identify whether we will have a trend day or a rangebound day. The markets like to take a breather after a strong trend day and there is a higher probability that the following day will be rangebound.

If the %TREND is high, that means the market closed far away from where it opened. If the %TREND is low, that means the market closed near the open. On a high %TREND day look for a low %TREND day the following session. On a low %TREND day look for a higher %TREND day the following session.

The calculations for the %TREND are listed in the thread: Identifying the %TREND