Same Trading, Different Direction

Trading yesterday was tricky for most.  Bars extended, then  retraced  removing many protective stops as candles overlapped in a strong bear trend day.  Knowing the direction is one part of trading.  Surviving quick, and at time violent, moves is another.

Move forward 24 hours.  trading is the same, we simple reversed the direction.  Again, surviving short term (few bars) swings was the key to success.

You could simple avoid these days, but traders will use different approaches to address strong, but volatile bar bear or bull  trend trading days.

• Increase your potential risk loss by using wider stops within the trend.  Your holding period will tend to increase as well to reach your +2 or +4 targets.
• Accept that break even may be higher, and hone your scalping techniques by accepting quicker exists.  If you normally try to exit at +2 or 3, use a +1 and BE setup.

One key thing to remember about trading strong but volatile bar days:  if you can normally read the charts and can identify a break to the upside or downside, those upside/downside moves will be quicker to retest the move before allowing the trend to continue.  This retest mode makes it more difficult to know if the up/down move is "the one" that runs, or if it will be tested two or three times before advancing.


OUTLOOK

[07:30] <@Chartmaster> THur outlook: longer term divergence let's see if we can push into 72.5-74.75. a failure of 58 would make 1253 attractive bias is the long side

We started the day with strong support of multiple MA's for the initial long trading followed by the retest  which was MAXT long.

Later in the day  a WATCH was release for 71 and 67. 

          [11:48] <Chartmaster> 71 & 67 watch..

 A WATCH is critical points for breakouts.  Support or resistance that does not fail at those points, becomes an attractive trade as well.  We took the 67 long into the upper watch range.

We also had CC with other charts for the setup.  The 5m was a MAXT long.

Additional scalp-type entries were made during the day.  All-in-all,  a productive day with volatile bar action.