Have you all been following the stuck zone I pointed out a couple days ago? If so, I hope you saw the classic breakdown-retrace-run this morning off the open. Here’s a chart I posted to the team area earlier (click to enlarge), after which we discussed entries:
Breaking out of a 2-day range is a powerful thing, and in that context, just about any kind of entry signal you use is going to make you happy! The key is knowing when you have a powerful context to trade in, and betting big. Think about it… mechanical rules are great, and scalping is great, but do you really want to take most of your position off at +1pt when you are expecting 8 more points in the move? I know I don’t. So, I’m doing a lot of work on understanding where we are in the market story, so I know when to expect big action.
For bonus points, if you measure the move prior to the breakdown, you’ll see a projected target down to 1090. The move overshot that a little, down to 1088, but then paused for a while. Cool.
What is SbsRenko?
Hitting singles consistently, but knowing when to take a big swing is huge. Wish I knew how!
stands for side-by-side renko, I think. Basically renko + wicks and overlapping bodies. Roonius made it, same guy who made the original renko patch for ninjatrader. It’s available at big mike’s forums.