Price Reading Lesson
Posted on September 26th, 2009
Written by Richard
Posted in: N/A (old archives)
Breakout. Retrace. Run. I know I come back to this pattern often when I’m discussing the markets, but it’s one of my favorites. It came up again on Friday in the eotpro live room, so I thought I’d make a video.
Here’s a screenshot of what I’m talking about (click to enlarge):
It’s very simple: when you have a S/R line of any sort, whether it’s Alla’s Average, or the edge of a congestion area, you have potential for this setup. You wait for price to break out, then retrace to the breakout point. If the retrace holds, you are looking for a signal in the direction of the breakout, in anticipation of a run. In this video, I use the LaguerreECO for the entries, but Bill’s Arrows or Everypush or Bonnie’s Bars will do the job as well. You basically want some kind of confirmation that price is initiating its run.
Here’s a video where I go through the the whole of Friday’s action:
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© 2010 Richard Todd. I am not a financial advisor, and nothing on the site should be considered investment advice or actionable recommendations. I'm just an individual, saying what I think, and sharing my experiences.