Major Trend Reversals (MTRs)

Question 1

What do most reversal patterns involve?

Answer 1

TRs

Question 2

What are the MTR Top Requirements?

Answer 2

Question 3

What are the MTR Bottom Requirements?

Answer 3

Question 4

What do most MTR reversals result in?

Answer 4

Most MTR result in a TR

Question 5

Is this enough buying pressure to lead to a Bull Reversal?

Answer 5

No

Question 6

In a Bear trend, if an MTR does not look right what should the Trader expect?

Answer 6

Expect a minor reversal into a TR or Bear Flag

Question 7

In a bear trend, when there is not enough Buying Pressure in the last bull leg what should the trader expect?

Answer 7

Expect a minor Bull trend for the scalp. At best it is a Bull swing/Leg in a TR or a PB, not a trend

Question 8

In a bull trend, when there is not enough Selling Pressure in the last bear leg what should the trader expect?

Answer 8

Expect minor Bear trend: for the scalp. At best it is a Bear swing/Leg in a TR or a PB, not a trend

Question 9

In a Bull Trend of the MTR does not look quite right what should the trader expect?

Answer 9

The trader should expect it to be a Minor reversal into a TR or Bull Flag

Question 10

Answer 10

Question 11

Does a MTR often need several attempts before success?

Answer 11

Yes, it often does as most MTRs develop in TRs.

Question 12

Do most MTRs lead to swing trades?

Answer 12

No most MTRs do not lead to swing trades; 60% of the time they will lead to a minor reversal with the remaining 40% of time they lead to big gains/winners

Question 13

Here we have 3 MTR setups with one of them leading to a Big profit; the Wedge, LH MTR

Answer 13

Here we have 3 MTR setups with one of them leading to a Big profit; the Wedge, LH MTR

Question 14

What is the most important reversal pattern?

Answer 14

The MTR is the most important reversal pattern. The MTR has a strong Trader’s Equation (Strong risk/reward ratio more than makes up for a low 40% chance of success)

Question 15

Most Reversals have a variation in the patterns for the MTR

Answer 15

Most Reversals have a variation in the patterns for the MTR

Question 16

What are the advantages of entering a probable MTR?

Answer 16

The advantage is the risk is small as the trader is entering early before there is a confirmed reversal, as the reversal comes only after there is a confirmed strong BO in my direction. The reversal is only a setup until the STRONG BO occurs

Question 17

For a higher probability MTR, what do I need?

Answer 17

I need a strong BO from the MTR setup point

Question 18

Strong Bear BO; still needs follow-through

Answer 18

Strong Bear BO; still needs follow-through

Question 19

Why does a Bear BO need to fall below HLs of Bull Trend for Bears to gain confidence?

Answer 19

Once the market falls below a HL the Bears gain confidence and deem the Bull trend over and it is now in a TR or a Bear Trend

Question 20

Why are these minor trend reversals?

Answer 20

Because the first break of the Bear TL was not particularly to strong so the reversals to follow may only be minor but still in-line with the premise of a MTR

Question 21

Sell HH MTR or LH MTR? Depends on Strong Bear Leg

Answer 21

Sell HH MTR or LH MTR? Depends on Strong Bear Leg

Question 22

Successful LH MTR; Sell Rallies

Answer 22

Successful LH MTR; Sell Rallies

Question 23

In every MTR there is a 40% probability of a swing trade profit and after the BO in the MTR there is a 60% probability of a swing profit

Answer 23

In every MTR there is a 40% probability of a swing trade profit and after the BO in the MTR there is a 60% probability of a swing profit

Question 24

Why is the MTR the best setup for Traders (beginners and Experts)?

Answer 24

Question 25

If MTRs 1st Reversal fails what should I do?

Answer 25

Exit and look to Re-Enter

Question 26

If new Signal; SELL AGAIN

Answer 26

If new Signal; SELL AGAIN

Question 27

Usually the first time we get bars Below the MA the trend usually resumes TRUE or FALSE?

Answer 27

TRUE, 1st MA Gap Bar(s) usually leads to the final leg of Trend, then MTR

Question 28

All MTR Tops are simply Double Tops

Answer 28

All MTR Tops are simply Double Tops

Question 29

What is the MAG Bar below the MA a sign of?

Answer 29

It is a sign of strong Bears and warning that bears might soon take control. Probably transition from a Bull Trend to a either a TR or a Bear Trend

Question 30

This is what a MAG can do to ignite an MTR

Answer 30

This is what a MAG can do to ignite an MTR

Question 31

a MTR needs two things, what are they?

Answer 31

a MTR needs CONTEXT and a good SIGNAL BAR

Question 32

Are perfect DTs rare?

Answer 32

Yes the are very rare, The market does not perfectly have to test the exact same price to create a DT

Question 33

Bull Trend, first reversal down is usually minor and leads to a TR (2 Lends down) and the trend resumes and then we get the MTR (LH/HH DT) and reversal down for a swing

Answer 33

Bull Trend, first reversal down is usually minor and leads to a TR (2 Lends down) and the trend resumes and then we get the MTR (LH/HH DT) and reversal down for a swing

Question 34

What are MTR Bottoms?

Answer 34

They're simply Double Bottoms

Question 35

The principle is the same; the market is testing the low of the bear trend and Deciding whether to break out or reverse

Answer 35

The principle is the same; the market is testing the low of the bear trend and Deciding whether to break out or reverse

Question 36

a DT MTR when does the probability increase for a profit?

Answer 36

Higher probability increases after a Bear BO

Question 37

For a Reversal to occur in a Bull trend, what kind of signs do I need?

Answer 37

I need signs that the Bears are strong; traders have to believe the Bears are strong enough to control the market and take the price down

Question 38

a Bear BO below a Bull TL needs what?

Answer 38

It needs Selling Pressure

Question 39

Whenever there is a Trend, keep drawing Trend Lines

Answer 39

Whenever there is a Trend, keep drawing Trend Lines

Question 40

DT or HH MTR what should I expect?

Answer 40

Expect a LH MTR and this LH is another opportunity too sell

Question 41

What does MTR Bottom need to Reverse?

Answer 41

a MTR Bottom needs to Reverse... 1. Break above Bear TL 2. PB (Rallies) to or around MA 3. I want the Rally to have signs of Buying Pressure. 4. The rally needs to have signs of Buying Pressure

Question 42

a Rally with very good Buying Pressure; just 3 Bull Bars can be enough. \*Remember the 1st reversal up is usually minor and the 2nd reversal up can lead to a swing trade

Answer 42

a Rally with very good Buying Pressure; just 3 Bull Bars can be enough. \*Remember the 1st reversal up is usually minor and the 2nd reversal up can lead to a swing trade

Question 43

MAG Bar usually leads to a strong PB(final leg in a Trend) creating a MTR. Watch to see if it is a HL MTR / LL MTR / Perfect DB MTR, look for reversal signal bar than entry bar up

Answer 43

MAG Bar usually leads to a strong PB(final leg in a Trend) creating a MTR. Watch to see if it is a HL MTR / LL MTR / Perfect DB MTR, look for reversal signal bar than entry bar up

Question 44

MAG in Bear Trend is a Sign of Buying Pressure

Answer 44

MAG in Bear Trend is a Sign of Buying Pressure

Question 45

Strong Bear Trend; Keep Drawing Trend Lines

Answer 45

Strong Bear Trend; Keep Drawing Trend Lines

Question 46

When I have a LL or DB MTR what should I expect?

Answer 46

Expect a HL MTR

Question 47

What is every Head and Shoulders Top and what is the right shoulder?

Answer 47

a HH MTR is the top and the right shoulder is a LH MTR. Therefore every Head and Shoulders Top has a HH MTR and a LH MTR in it

Question 48

What is every Head and Shoulders Bottom and what is the right shoulder?

Answer 48

a LL MTR is the top and the right shoulder is a HL MTR. Therefore every Head and Shoulders Bottom has a LL MTR and a HL MTR in it

Question 49

Are Nested Patterns common in HST & HSB? (Head and Shoulders Tops/Bottoms)

Answer 49

Yes it is very common too see Nested Patterns in Head & Shoulders Patterns

Question 50

MTR Bottom often has a DB

Answer 50

MTR Bottom often has a DB

Question 51

Are MTRs often in Tight TRs containing DBs(For a Bear to Bull Reversal)?

Answer 51

Yes they do especially if it is in a Tight TR

Question 52

What does a MTR Top have within it sometimes?

Answer 52

Often has a DT in. Remember every HST is a MTR; certainly, the right shoulder is a LH MTR.

Question 53

Do all patterns Fail?

Answer 53

Yes they do and they fail often 40-60% of the time

Question 54

DT LH MTR often is in a TTR

Answer 54

DT LH MTR often is in a TTR

Question 55

DT HH MTR - DT in TTR

Answer 55

DT HH MTR - DT in TTR

Question 56

When I have a MTR Top failing what does the market usually do?:

Answer 56

Usually, there is a MM and 2 Legs up

Question 57

What do most Failed MTR lead into?

Answer 57

Most failed MTR lead in a TR or a Resumption of the current Trend

Question 58

Failed MTR Bottom, I need to start the process over again for another potential MTR when it emerges in the market

Answer 58

Failed MTR Bottom, I need to start the process over again for another potential MTR when it emerges in the market