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Monday, December 31, 2012 9:48:42 AM
You Can Trade Anything - With the Right Method
In this Chart of the Week (COTW), I am going to show you a few Pristine Trading concepts taught in Trading the Pristine Method®. The instrument used in irrelevant, since you can trade anything with the right method. However, this tradable instrument has recently turned up from a long-term downtrend and has the potential to be a huge winner in 2013.
The breakdown in September was followed by a 100% retracement of that breakdown. This is the typical price action at the start of a bottom. This was followed by a retest of the low and while this is also a 100% retracement lower, it's what often happens during a bottom process. Pristine Tip: 100 % retracements of an advance are acceptable during a bottoming process; however, it's a sign of weakness in an uptrend.
In November, there was a strong rally that created a Pristine Price Void (PPV). Creating a PPV below is bullish, but it also opens the potential for a sizable pullback. Pristine Tip: The strongest of trends do not pullback, they create new support. This is what happened as prices moved sideways into the rising 20-MA. The breakout above resistance (red line) stalled and a Money Bar (MB) setup for formed that signed a Measured Move (MM) higher. The current Topping Tail (TT) is far from the 20-MA and suggests a pullback within the uptrend.
The bottom process actually started at the beginning of 2012. Let's review how that happened. We see the shakeout early in the year that was following by a strong rally. That rally created a large PPV below. The pullback to Minor Support (ms), retest and next shakeout formed a higher low. When the rally from that low occurred, we see that a Red Bar Ignored (RBI) formed, which is the sign of bulls being in control. As prices reached resistance it's expected that selling will increase. However, the price action at that resistance was the tipoff of more buying to come. Pristine Tip: Bottoming Tails (BT) at resistance signal that buyers are stepping up on dips and still in control.
Read full article here: http://bit.ly/WWfrJW
In this Chart of the Week (COTW), I am going to show you a few Pristine Trading concepts taught in Trading the Pristine Method®. The instrument used in irrelevant, since you can trade anything with the right method. However, this tradable instrument has recently turned up from a long-term downtrend and has the potential to be a huge winner in 2013.
The breakdown in September was followed by a 100% retracement of that breakdown. This is the typical price action at the start of a bottom. This was followed by a retest of the low and while this is also a 100% retracement lower, it's what often happens during a bottom process. Pristine Tip: 100 % retracements of an advance are acceptable during a bottoming process; however, it's a sign of weakness in an uptrend.
In November, there was a strong rally that created a Pristine Price Void (PPV). Creating a PPV below is bullish, but it also opens the potential for a sizable pullback. Pristine Tip: The strongest of trends do not pullback, they create new support. This is what happened as prices moved sideways into the rising 20-MA. The breakout above resistance (red line) stalled and a Money Bar (MB) setup for formed that signed a Measured Move (MM) higher. The current Topping Tail (TT) is far from the 20-MA and suggests a pullback within the uptrend.
The bottom process actually started at the beginning of 2012. Let's review how that happened. We see the shakeout early in the year that was following by a strong rally. That rally created a large PPV below. The pullback to Minor Support (ms), retest and next shakeout formed a higher low. When the rally from that low occurred, we see that a Red Bar Ignored (RBI) formed, which is the sign of bulls being in control. As prices reached resistance it's expected that selling will increase. However, the price action at that resistance was the tipoff of more buying to come. Pristine Tip: Bottoming Tails (BT) at resistance signal that buyers are stepping up on dips and still in control.
Read full article here: http://bit.ly/WWfrJW
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