“Reference the the immediate leg for your current price action and reference that leg to the primary leg to see the bigger move”.
Imagine if you knew about legs. Would it have prevented you from shorting 43. So sad how people were trying to short earlier but didn’t see that we are working to retrace up the leg down from 1.586k.
Now as you know, how we gain levels or lose levels, you will always test and be repelled on first try. Many people don’t understand that. They don’t get how to reference the price action to the immediate leg and reference that leg to the to a primary leg.
If you had done that you would know that reaching 43 again today would be your 2nd touch.
Now the first touch was done 2/18. We then sold and until today, we retraced back up. Upon reaching this level of resistance, it would be 2nd touch in the progression for the bounce from 03/10 lows. Now where do we get the levels from? The primary leg down of course. You will utilize all the levels relative to this price range. If you go to the weekly, you are currently retracing up the 6/16/08 candle. You will use that bar and grab all the levels going back to 2006 that will be significant as we retrace up that candle.
The leg hopping came from retracing back up that 43 Feb high then hop to the main leg that will tell you how we are retracing off a larger leg. This is no different with what you would do on the intraday. This also compartmentalize the action to help you see the range the trend is working on.
Now what will happen as you reach significant levels off this main leg? Same thing you did when you hit 43. Same thing you did when you hit 46.25 on the first try.
Implementation of this kind of strategy will help you increase your probability of a good trade and minimize your risk. By understanding what the market is doing. Not only in the short but in the longer time frame. If you can’t understand what the market is going to do, that should be a red flag for you to know that you don’t know enough and should probably sit on your hands. A good trader follows the will of the market and does not think his mental meanderings will move it. It doesn’t matter if it is a pomo day or fed day or what have you. The charts will lead the way. Your job is to follow. This kind of thinking elevates you from a junior trader status. You wont care to note any of those funnymentals that others use as an excuse as to why the market did what it did especially when it does not do what they expected. You read the charts and follow the basic tenets of technical analysis.