So, while we have been having this discussion, I have been trying even harder to focus on continuation rather than reversal, and I have to say that trading seems a bit more "effortless" this way. Don't get me wrong, I'm very concentratet and it is making me paying even more attention to price action than ever, but the ITM's just roll in easier than when fighting with reversals. 75% ITM yester day and 80% today (4/5) I just took this trade on GU and it is a good example.
If you look at the bigger scale, GU is trending down, but it hit support during Asia and starting going up, so as it was going up this morning, I was kind of looking for exhaustion and waiting for confirmation to take a put. I pay a lot attention to Ichimoku, and after all, the sentiment was bearish all the way from TF 15 to H4.
On the other hand, it had broken the kumo cloud on TF M5, so I was open to a call as well. After breaking a trend line over the cloud, it did look like it was starting go get exhausted, with a series of bullish candles getting smaller as it approached the trend line, and then came this indecision candle just as it broke my trend line. But, big but, I watched this weak bearish indecision candle very closely as it formed, for the whole 5 minutes, though volume was decreasing, there was clearly a fight between bears and bulls, and even though it looked like it tried hard to reverse and go down, it just couldn't break down under the previous resistance it had broken and the trend line, so I thought, the MF'er is going to continue, no matter how high you think it is. Went for a call and got a deep ITM. (Yes, the kumo cloud breakout and the shape of Tenkan/Kijoun/Chinkou did support me in this decision).
Bottom line, though it can be difficult, I need to be open to what is actually happening on the market, and not letting my brain trick me into reversals before they are actually confirmed. That also opens a lot of opportunities to get on free rides with the trend, being short term or long term trends. Price can only do one of two things, reverse or continue.
PD: Price did start to retrace a few candle after this trade.
Sup sexy Brian!
Just one remark about the volume stuff! Since this morning I have been looking at the Ichimokou and that piece of shit of Tenkan that I thought was just a motherfucker got a famous utility!
Just look at is, on the undecisive candle the tenak, which as u know represent a shit about the 9 last candle is still going up, which means that despite the indi showing drcrease in vokume,the tenkan show that there is still plenty of power and the momentum is still there! I looked at the history of last week and indeed, for Breakout/PullBack at a RS/Trendline, the tenkan, on opposite candle, if still rising, give us a good sign that momentum is still there and we can destroy keep riding the wave!
Just a little thing I wanted to share! I feel really cool to havr fond a utility to this crappy Tenkan! *CLAP CLAP*