Strong entry point IN STOCK MARKETS
The most revealing elements of the exchange chart are the levels. Understanding the levels, and following the simple rules formulated by BUY SELL SOFTWARE allows us to identify a strong entry point. And the correct entry, as you know, strengthens the market position by an order of magnitude.
So, what are the useful levels?
There are three main types of levels – support, resistance and mirroring. The most informative of them is the mirror one. It has a floating structure, and is formed when the support level becomes a resistance level, or vice versa. In practice, this shows that at the moment one player wins the other.
All other levels – is conditional constructs, and therefore you can carry them wherever you want , where you feel good to put them. Many experienced players do not advise to invent extra levels , but at first the trader needs to learn to see and choose the fulcrum for further steps. There are minimal rules.
Levels must be drawn near strong points, such as a break in the trend, or a long While false breakdowns, you need to take near very strong levels: extremes and hard pro-negotiation.
Imagine an ideal chart with all possible levels, among which there will be “bullish”, “bear”, “sentry” and others. For a while, we just observe the situation on the chart.
Let’s say that you see that your tool has rested on one of the levels. Now you need to “check” the level – hit at different points and watch the reaction. For example, if the next “bar” falls above, or lower than the previous one – wait. When two “bars” in a row stop at the same level – this hit. About previous provisions can be forgotten. In this place, most likely, a strong player sat down.
How to find the entry point?
At the stage where the above picture arises, there are two conditions that can give a strong entry point. We need to see at least one of them.
1 . A distinctive limit trade.
All levels must be taken only on large time frames. They, in contrast to the five-minute, show a large player who, leaving the position, leaves a mark. Limit ORDERS should form at least 3 “bar”. It also works on “watchmakers”.
2 . Points of turns or extremes.
Extreme is a model formed by shadows. The turning point – can be formed not only by 1 bar. Long tails are usually considered bad forerunners, but PROFESSIONALS argue that the tail is good. The longer the tail, the stronger someone accelerates the position. Usually, after a long tail begins a very strong movement.
Assessing the level – evaluate its strength. The strength of the level gives a comfortable approach . If the level is very strong, then the call can be 20 contracts. If the level is weaker – you can go, for example, with 15 contracts. The approach is positioned from the stop and from the strength of the level. The stronger the level, the shorter the stop . The shorter the stop, the greater the position.
Do not forget: even with a very successful entry it is possible to drain. Even the strongest strategy does not guarantee a 100% victory. Nobody can accurately predict the actions of all players in the trading process. Trading is a dynamic and probabilistic system , so the top of the skill here is the movement in the flow of the most likely success.