Entry Strategy

[Sean K]

Kennas

I was going to follow it here using the VSA analysis above if interested.
I can explain things as we go.

Yep, no drama, but this thread should perhaps be left to 'entry strategy'. I have my own unique plan for MTN which is a whole other story. ie, Hold and hope it goes to the moon!!!! LOL. Seriously, further discussion on this trade might be better in the MTN thread, or another. Not sure which one. Suggestions?

 

[tech/a]

I'll stick it in the exits thread !

 

[motorway]

ok.. here is a the chart of CSM with trend lines that I got a friend to do and mail it in. Is it right ?

aso have attached a clean line chart if anyone wants to draw the right one.. Can also post a candlestick one.

Is it right ?

A loaded question

It is right when it does what you want it to do..

trend lines are like the straight edge of the carpenter.
Skillfully put at the right junctures they are very powerful tools

My answer would be sort of..

trends are waves of movement
higher highs higher lows

They run into counter trends

These junctures can be defined by price and volume signatures

Normal use requires two reactions of equivalent magnitude ( Very important )
That is how a carpenter uses his straight edge
across two high points ( Not just one )

the reverse use requires evidence of that counter trend

here is how I would draw for CSM

The red normal use are picking up two reaction lows of similar magnitude
The reverse use is originating at the high volume that turned the trend back down and linking up with the current action..

Should already have bought CSM
next entry if action confirms is at the three zones of possible support

or after evidence of absorption ( of the supply that the reverse trend line has been formed from ) and a breakout at even steeper angle of trend..

motorway

 

[Chorlton]

Normal use requires two reactions of equivalent magnitude ( Very important )
That is how a carpenter uses his straight edge
across two high points ( Not just one )

motorway

Hi Motorway,

By "Magnitude" are you referring to Volume??? ... and if so, am I right in assuming that you are looking for a similar price level with similar volume for drawing your trend lines?

Thanks in advance,

Chorlton

 

[motorway]

Hi Motorway,

By "Magnitude" are you referring to Volume??? ... and if so, am I right in assuming that you are looking for a similar price level with similar volume for drawing your trend lines?

Thanks in advance,

Chorlton

In an uptrend Two reaction lows of similar PRICE magnitude
defines the normal use of trend line
That defines the degree of trend..immediate intermediate medium long
you are defining
when action of a certain character makes that definition doubtful
Then that wave of action is in some way completed

The reverse use brings in the volume qualification
In an uptrend it would be the area where supply as evidenced by volume
stopped the trend

You should draw the reverse use when ever warranted but not try to force it

The two together will reveal all sorts of price patterns
And show volatility contracting and expanding
The names of the patterns means zip
They can be continuation or reversal It is the character of the action.. The how the lines are crossed.
That is what matters .

eg

The lines on Beach reveal a lot of information
contraction of volatility
Is that a rising wedge ? ( does not matter )

The character of the action
price , volume, range of the bars, thrust , reaction ( held above 50% level )

point to volatility falling as supply was absorbed

Now We will see what the character of the action at the upper ( overbought )
trend line reveals..

keep the trend line sensitive to the degree of move You are following
and to the action itself.. watch out for changes in speed..
Focus on the Character and not just appearance.


Some basic Wyckoff 101


motorway

 

[motorway]

I am getting some PMs

So it only looks like I am talking to myself

here is CSM

updated

stocks go down to go up
because the "public" sell when it has gone down and buy after it has gone up

BUT trends are not straight lines they are waves

smarter money is on the other side of the trades

Wyckoff said that in looking to go long
focus your analysis on the down waves of action
You want to be in step with the smarter money

Of a series of errors He identified in the average trader
the most serious was being out of step with this wave like motion

Someone thought CSM was a good buy at the top
There is a high vol bar

But what has happened ?

What does the last bar suggest
Is CSM in a downtrend ?

Not at this stage it is in a clear uptrend..

But I don't see a buy setup at the moment
atm I think it is going to have to go down in order to go up..

It is all waves that " last as long as they gather a following... Volume is following "

The trend lines give the action a frame of reference
So We can detect change in the speed, the angle of trend...
and the changing demand supply relationships..

motorway

PS It is only an example and for discussion.. The next bar of action is new information that could change .. everything and it is an online reply to a few PM's

 

[chops_a_must]

I use a combination of pivot points and fibonacci levels for entries... and exits for that matter.

I use the fibonacci retracement/ extension levels for "general" timing and confirmations of when to and when not to enter trades.

I use the pivot points for exact entries and exits. I have found it extremely accurate, often buying in near day lows or getting out near day highs. It also stopped in its tracks the habit I first had when I started out trading/ investing; that of "chasing" a share when making my mind up to buy a share at an "arbitrary" price originally.

I have found these to be great strategies. I hope this helps.

Cheers,
Chops.

 

[motorway]

Should already have bought CSM
next entry if action confirms is at the three zones of possible support

or after evidence of absorption ( of the supply that the reverse trend line has been formed from ) and a breakout at even steeper angle of trend..

CSM gives a good demonstration of focusing on context

And among other things trend lines help give context

next entry if action confirms is at the three zones of possible support

If you update the chart... What happened in the vicinity of $2.70
and what was the context ?

Prices then moved up and reacted off the reverse supply line

( As We might expect ? )

But what was the "character" of the reaction ?

Price Backs up into a narrow range
and Jumped through that line at ~ 3.30/3.35

Then there was "absorption"

or after evidence of absorption ( of the supply that the reverse trend line has been formed from )

at the ~~ 3.45 level


What gives the context is the trend lines ( When you have the two sets operating You get all sort of volatility patterns displayed )

And the relative strength of thrust and reaction

( No retracement at the reverse supply line rising bottoms of the bars )

some key words

ease of movement ( thrust / reaction )
change of behavior

seen in context

The buy at ~2.70 was a primary Wyckoff Buy set Up
( Of which there are 8 along with corresponding 8 short setups )


motorway

 

[nomore4s]

Thanks MW, good timing have just read the article on reverse support lines, lol.

This gives a very good working example, yet more to ponder

 

[nomore4s]

MW, there also looks to be a new set of reverse trendlines formed at the last high.
Thoughts on this?

By the looks of the last bar supply looks like it is drying up? Of course that could change on Monday.

 

[tech/a]

Hmm

New toys.

 

[motorway]

The entering of the opposing
force is the rationale for starting the trend line along the resistance points in an uptrend. Under these reverse circumstances
support would be expected to enter at a different level and indeed the entire
upward trend channel would shift to a different angle of ascent or stride.
What is not obvious and indeed misleading with the regular use, namely that
prices are not turning at the orthodox rising support line but elsewhere, suddenly
becomes clear, obvious, reliable and predictable when price action is cited off the
“reverse use of trend line.”

Yes We now have a logical and sensitive
trend channel framing the action and giving context.

helping Us define the trend and the position in the trend..

From a certain position process unfolds

positions are defined in terms of technical strength and weakness

overbought /oversold..

Context, recognising it
and getting enough of it
is important..

motorway