Breakouts of new trends need some experience to read correctly. Today b13 was a breakout above b1 giving a breakout and setting up a BP. b15 and b19 setup extremely weak BP signals that very few traders took. The second failed attempt to turn up makes this a failed A2 and sets up a trend move that is likely to test the low of the entry bar b5 at the very least.
When the range is wide enough and the bars are normal sized (6 to 8t), a fBOs on one side often results in a successful BP on the other. b33 provided an A2 that was similar but succeeded and went to a measured move of the opening range at b38.
The move was channel-like and in spite of the final flag that followed b38, there was a very good chance that its low would at least be tested.
To summarize, if a break above the HOD or below the LOD in the AM move gives a poor 2 legged pullback, its failure is likely to reverse the breakout and is a likely trend generator.
Cad,
ReplyDeleteDoesn't 1Rev appear only after 2 legged move? In this case, why did you take b4 as 1Rev?
Thanks in advance.