OTHER PATTERNSIn this video, We talk about other patterns like the Ascending channel, Descending Channel, and Divergence.
I hope this helps us in our journey
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Structuredtrader
USDCAD H1 practical setupsSometimes the setups don't come at the right times. So what do you do?
Here's a breakdown of some alternative entry strategies you can think about.
USDCAD idea update - why you must get your entry rightHere's another example of the larger time frame providing plenty of chances on the lower time frame.
A healthy breakout is one with buildup against the level under attack. If we keep probing/failing....and STILL attacking the level from closer and closer, you know where the pressure is.
I'm sure you already use variable size to consistently risk the same % of your account per trade. i.e. keeping risk the same whether you're accounting for 10, 20, or 30 ticks/pips.
I'd suggest adding another filter - standardizing the SIZE of your stops. By that I mean if you're taking trades with stops between 10-30 ticks/pips, that's fine. But what if another move suggests a stop of 100 pips/ticks? Can you expect the same R out of the move? Are you actually just chasing price?
This filter will get you to be more disciplined about your entries, keeping them tight and decisive.
This move was already extended. But the level was attractive enough I expected a healthy push at least to the levels I marked out.
This is very different to trying to get in with a young, strong trend. You've got to recognize what you're trying to get out of the move and how the market is likely to react at SPECIFIC points.
Why an early fail can actually HELP a breakoutThis is a great example for traders of all timeframes to study. I don't really have time for people basing trades on wide zones - that's fine for analysis, but for a TRADE, you've got to see the fight at a specific level. When you draw these correctly, you can get a really great picture of evolving sentiment and balance of power shifts.
Most traders treat breakouts way too lazily. You don't just enter at a new High/Low. You NEED buildup.
Any naked attack from distance is likely to fail. But what if it only pauses, instead of crashing?
Do you redraw the level? Do you avoid the trade completely?
What works for me:
Talk out the developing scenario. A fail failed? Ooh, interesting. Maybe there's more power on the original side than expected.
Once the breakout's happened, how is the other side thinking? I was biased long, getting everything I wanted to see....but what would the Bears want to see? Probably a close back under the grey/yellow boxes, right?
But wait, now that we created another temporary level during the failed probe, there's another level price needs to break through before even attempting the yellow level and then grey boxes!
--> this makes for a likely bounce point, and creates several chances for late entries. Best of all, it means a breakout entry at the original level will be protected by that bounce and your trade stays green.
Ideal trades series; G/J D1 SR break + close (2/2)Here's the setup on the H1.
Apply this to any time frame. If you're using important levels and trading at the right times, most healthy breakouts involve some version of this shape. Strong, confirmed breakout with a clear close past the level, a weak but steady pullback to the level, and then an immediate fail at support-turned-resistance.
Ideal trades series; G/J D1 SR break + close (1/2)This is the type of context shift we're looking for. The breakout bar shifts us from analysis mode to trade hunting....looking for lower time frame, healthy PBSR to risk off a level retest.
See comment for H1 ideal entry.
(These are not trades I took, I'm just building a solid study library and I suggest you do the same).
level attack without buildup, the recipe for a trapWhen you have your eyes consistently at the same important levels (preferably horizontal ones), you'll quickly see the difference between a buildup that creates a powerful breakout vs a breakout fail / trap.
Naked run ups like this can be scary to get in front of, and it's not a straightforward entry, especially if you're executing on the H1. But this is why you should be building libraries of similar setups. If price knifes through that level and shoots straight up, its likely because of some really spectacular news catalyst. But in NORMAL market conditions, this is a great trap patter to study.
I think I recently shared a chart showing consistent buildup ahead of a level on the NQ. Several turns, wedging, etc BEFORE the level's probed. That's power, like a coiling snake. But no coiling here.
Think about the psych of the traders involved here.
The Bulls who bought down low are happy and probably looking for an excuse to cover. Smart longs are covering at least part of their position here (sell orders).
Some late FOMO Bulls are looking to get in and will try and buy on a probe past highs. Big money isn't doing this.
Bears are entering and keep pushing price back under the level (check out the 15m). With each bar, more Bears are selling.
IF price pokes back up above highs, that's usually where Bears will tap out and the BO will be safe. This actually momentarily happens on the 15m, but it ends up turning into a second Bull trap.
From the same perspective, once we've got that wedge, a push below the wedge spells the end of the Bulls. When it happens, there's no fail of a fail....Bulls pull out, and price crushes back into the big range.
