Trading Climactic Reversals (Failed Breakouts) Flashcards
If the Bulls can make money in a Bear Trend what is that telling me?
That Channel/Trend is not all that strong and it will soon probably transition into a TR or a Trend Reversal
Where do Bulls enter the market?
Bulls enter where Bears take Profits and Vice Versa for the Bears
Weak Bear BO - Deep PB
Weak Bear BO - Deep PB
Bulls and Bears Buy Low and Sell High (BLSHS)
Bulls and Bears Buy Low and Sell High (BLSHS)
Most Traders should NOT Reverse
Most Traders should NOT Reverse
Every BO Trend Bar is at least what?
Every BO Trend Bar is at least a Minor Climax
Climax is an acceleration of a move up or down
Most BOs(climaxes) are minor and are part of TRs or Channels
Climax- Exhaustion Gap (EG) OR Measuring Gap (MG) …
Climax- Exhaustion Gap (EG) OR Measuring Gap (MG) …
Exhaustive Buy Climax - Beginners should exit their Longs
When you get a Buy Climax I should not bet thinking a Reversal into a new Trend rather I should be thinking about this is an exhaustive end to the current trend (a Pause) and see what the Bears can do from this point; rather that is a TR or a Reversal
Exhaustive Buy Climax - Beginners should exit their Longs
When you get a Buy Climax I should not bet thinking a Reversal into a new Trend rather I should be thinking about this is an exhaustive end to the current trend (a Pause) and see what the Bears can do from this point; rather that is a TR or a Reversal
When you see a Big Climatic move near a possible end of a Trend, I should see this as a GIFT and take profits.
Strong Bulls will take profits, do NOT look to Buy
When you see a Big Climatic move near a possible end of a Trend, I should see this as a GIFT and take profits.
Strong Bulls will take profits, do NOT look to Buy
Exhaustive Sell Climax - Beginners Should EXIT SHORTS
Exhaustive Sell Climax - Beginners Should EXIT SHORTS
What do the Weak Bears do at Highs?
Weak Bears Buy at Highs
Weak Bears who have been selling and possibly scaling in can no longer take the pain and buy back their shorts
Strong Bulls bought lower when RISK was Big
Strong Bulls bought lower when RISK was Big
What do Strong Bulls see a BIG BO as near a probable end of a Trend?
Strong Bull see a BIG BO as a Gift and they take PROFITS
Do Strong bulls wait to Buy after a Buy Climax or do they Buy during?
Strong Bulls wait to Buy after a Buy Climax
The strong Bulls want to see if the Bears will be able to create a Reversal down and after 10 Bars down if the Bears fail to do that the Bulls than assume the rest of the day will be in a TR
When Strong Bears see this BIG Buy Climax they know the Bulls are taking Profits and will wait to buy for 5-10 bars
Strong Bears Sell Strong Bull closes at the same time Strong Bulls are Selling to take Profits
When Strong Bears see this BIG Buy Climax they know the Bulls are taking Profits and will wait to buy for 5-10 bars
Strong Bears Sell Strong Bull closes at the same time Strong Bulls are Selling to take Profits
Strong Bears sometimes sell the close of a Climatic Bull Bar
Strong Bears sometimes sell the close of a Climatic Bull Bar
Major Climax is Big BO Late in Trend
It is important to be aware of Big Climatic moves near the end of a Trend, be aware it could be a reversal (MTR) into an opposite Trend or simply a pause in the Trend
Major Climax is Big BO Late in Trend
It is important to be aware of Big Climatic moves near the end of a Trend, be aware it could be a reversal (MTR) into an opposite Trend or simply a pause in the Trend
What are some ways to Enter for a Reversal at this Bull Climax at the top of the TR for a Short?
Sell the close of the huge bull bar,
especially since it has a tail and is in a TR
(possible 2nd Leg Trap)
Sell the Close of the small follow-through bar buy signal bar
Sell reversal below bear bar
Sell above High 1 after 3 bear bars
As Trends progress they weaken
As Trends progress they weaken
Where is the Profit Target?
Bears are looking for a MM Profit taking area at the bottom third of the TR
Profit Target is at or below bottom of Bull BO
Where is the Stop?
The Stop is just above a Measured Move up
When should I use a Tight Stop in a TR?
Use a Tight stop when there is a Strong Signal
Failed BO - Scalp Part or All of Position
Failed BO - Scalp Part or All of Position
V Tops and bottoms are almost ALWAYS are Something Else
V Tops and bottoms are almost ALWAYS are Something Else
Exhaustive Sell Climax - Big Bear Bar Late in Bear Trend
Exhaustive Sell Climax - Big Bear Bar Late in Bear Trend
Wedges do not always have to have perfect wedge shapes, as long as there is 3 pushes up or down it can me classified as a wedge with great context.
However the better looking the wedge the higher probability exists in that wedge
Wedges do not always have to have perfect wedge shapes, as long as there is 3 pushes up or down it can me classified as a wedge with great context.
However the better looking the wedge the higher probability exists in that wedge
After EXTREME Selling who does the probability favor?
After extreme selling the probability favors the BULLS
Do not expect an instant Major Reversal but if we get a TR & the probability is even more in the Bulls Favor they will start to look to BUY
Anything that is unsustainable in the markets is Climatic
Climax since unsustainable able there is a 70% chance of a TBTL PB or reversal and only a 30% chance of a bear BO and new swing down
Anything that is unsustainable in the markets is Climatic
Climax since unsustainable able there is a 70% chance of a TBTL PB or reversal and only a 30% chance of a bear BO and new swing down
Is a Micro Channel Late in a Trend a Climax or is it just a a Micro Channel?
a Micro Channel Late in a Trend is a Climax
18 bar bear Micro channel will soon have no one left to sell making it a climatic move
Climax since unsustainable able there is a 70% chance of a TBTL PB or reversal and only a 30% chance of a bear BO and new swing down
Does the 1st BO above a Micro Channel usually succeed or fail?
The 1st BO above a Micro Channel usually FAILS
but a Trader can scalp since a reversal is likely soon after an extreme climax
Anytime I see a Sell Climax what should I be doing and preparing for?
Look to or Prepare to Buy
If Climax is NOT EXTREME is the Reversal usually Big or Small?
If the climax is not extreme the reversal is usually small
Unusual Behavior = Is Unsustainable and Climatic
Unusual Behavior = Is Unsustainable and Climatic
Buy Climax = SO DO NOT BUY
Buy Climax = SO DO NOT BUY
How often does a strong trend transition to a reversal strong trend?
This very rarely occurs in the market
When a strong bull reverses, usually it is a minor reversal into a TR or Bull Flag
Once in TR, then it can form a MTR and an opposite trend
When I sell a Buy Climax WHAT IS MY GOAL?
When Selling a Buy Climax, the GOAL is a Scalp
If then forms a MTR, goal can then be a Swing Trade
Is the first reversal up after a climatic move usually major or minor?
The first reversal up is usually a minor reversal into a TR or bear flag
Once in TR, can then form a MTR and an opposite trend
After a minor reversal up from a strong bear climatic move the Bulls wills look for a DB in a TR for a MTR swing trade
After a minor reversal up from a strong bear climatic move the Bulls wills look for a DB in a TR for a MTR swing trade
After a Climax what is likely to occur in the markets? And what can it form?
After a Climatic end to a Trend the odds are high there will be sideways movement and a TR will emerge
In this TR it can form a possible MTR
Whenever the market makes a strong move on the open there is a 50% chance the move is in the wrong direction
Whenever the market makes a strong move on the open there is a 50% chance the move is in the wrong direction
a Climax is common on the open
a Climax is common on the open
Final Bear Flag lead to a Climatic BEAR BO to Reversal up
Final Bear Flag lead to a Climatic BEAR BO to Reversal up
When buying in a Tight Channel you are buying for a scale as reversals will be minor
When buying in a Tight Channel you are buying for a scale as reversals will be minor
Bears Sell DT Bear Flag for a Swing Down
Bears Sell DT Bear Flag for a Swing Down
Exhaustion Gap can become a Measuring Gap
Exhaustion Gap can become a Measuring Gap
a Failed Reversal attempt often leads to a Measured Move (MM)
a Failed Reversal attempt often leads to a Measured Move (MM)
What is one way to reduce risk?
One way to reduce risk is to reduce your position size
What kind of Traps are common in TRs?
2nd Leg Traps are very common in TRs
80% of BO attempts Fail
Reasonable to take Partial Profits at the bottom of the Buy Climax
Whenever I have a weak Bull rally what is it most likely to be?
It is probably the start of a bull leg in a TR
10 Bar Bull Micro Channel so relatively strong bulls but this
rally is weak since small bars, overlap, and tails
When Trend is Weal the Climax is usually small
When Trend is Weal the Climax is usually small
STRONG Reversal from Sell Climax and GOOD CONTEXT
=
Likely not to go much further down and will start to evolve into a TR and possible Reversal
STRONG Reversal from Sell Climax and GOOD CONTEXT
=
Likely not to go much further down and will start to evolve into a TR and possible Reversal
What does a Small Climax usually lead to?
a Small Climax usually leads to a Minor Reversal and than evolves into a TR
