Triggers Flashcards
Each trigger is an ______ point in which bears or bulls take control over the price action
Emotional
1 minute trigger, not as _______
Meaningful
What triggers are meaningful?
5min, hourly
1 minute trigger has the smallest ______
Line
5 minute trigger has a _______ line
Staggered
1 minute trigger line moves every
1 minute
5 minute trigger moves every
5 minutes
Hourly trigger shifts every
Hour
5 minute trigger is an ______ battle ground
Emotional
What does a “Trigger” represent in trading?
A trigger represents an emotional point in which bears or bulls take control over price action.
What does “Velocity” teach in terms of price movement?
Velocity teaches that “price cannot REMAIN moving in a certain direction if velocity does NOT support it.”
What is the significance of a “Bear-plane”?
A bear-plane occurs when there’s trigger rejection
Describe the importance of the “5-minute” trigger timeframe.
It shifts every 5 minutes and is considered an EMOTIONAL BATTLEGROUND, where prices cross above or below.
How often does the “Hourly” trigger shift?
The hourly trigger shifts every hour.
How would you describe the trading strategy based on risk to reward?
It is extremely minimal risk to reward.
If you’re going long, when is it recommended NOT to remain long? As a trigger
Once the price closes below a trigger.
If you’re shorting, when should you consider exiting your position? Triggers
Once the price closes above the 5-minute trigger.
Why is it important to wait for candle closes in trading?
To avoid FAKE OUTS to the upside or downside.
Give an example of what you should do if you’re long and the price closes below the 5-minute trigger.
You should consider exiting your long position to minimize risk.
If you’re short and witness a FAKE OUT to the upside, what might’ve prevented you from making a hasty decision?
Waiting for the candle to close would help in determining if it’s a genuine movement or a fake out.
What emotion does the “5-minute” trigger timeframe evoke in trading?
It’s an emotional battleground, indicating high tension and decision-making moments.
Provide an example strategy based on the velocity teaching.
If a stock is rising rapidly but the velocity doesn’t support its movement, it might be wise to anticipate a reversal or slowdown in the upward trend.
According to the provided text, how does velocity influence the price direction?
For the price to continue in a certain direction, velocity must make new highs (or new lows) corresponding with each new price high (or low).
How is velocity simplified in terms of a price moving HIGHER?
For the price to keep moving HIGHER, velocity HAS to keep making new HIGHS.
How is velocity simplified concerning a price moving LOWER?
For the price to keep moving LOWER, velocity HAS to keep making new LOWS.
What can be deduced if the price is moving higher but velocity isn’t?
The move is FALSE and is likely running on fumes, indicating it might not sustain.
Use the car analogy to explain the relationship between price and velocity.
Imagine driving a car and taking your foot off the gas. Even though the car continues moving, it will eventually stop if you don’t press the gas again. Similarly, if bulls don’t increase velocity, a rally will inevitably end.
In the context of the analogy, what does “putting the foot on the gas” symbolize?
It symbolizes increasing velocity.
What action should you take based on the “move extreme print”?
You should look for THREE new highs after velocity makes its highest high.
If velocity does not support the direction of the price movement, what can it indicate about the market trend?
The trend may be deceptive and could potentially reverse or stall soon.
What happens to a rally if bulls never increase velocity?
The rally will inevitably come to an end.
Why is it significant to watch velocity in relation to price highs and lows?
Because it indicates the strength and sustainability of a price move.
How does velocity help in determining genuine price moves versus false ones?
If price moves in a direction (higher or lower) without the corresponding change in velocity (new highs or lows), then the price move can be considered false.
What’s the consequence of a rally running on “fumes”?
The rally will not sustain and will eventually come to an end.
How does the car analogy relate to the concept of momentum in trading?
Just as a car needs continuous gas (momentum) to move forward, a price trend needs consistent velocity (momentum) to sustain its direction.
If you observe the velocity making its highest high, what should be your next step in the strategy?
Look for three subsequent new highs in the price.
Why is it important for traders to understand the relationship between price and velocity?
Understanding this relationship helps traders validate the strength of price movements and potentially avoid false signals.
What is meant by “bearish divergence” in the context provided?
When the price makes THREE new highs without velocity breaking above the most extreme print (red line).