forex:price_action:impulsive_moves
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| * It should communicate that there is very little profit taking from the players behind that candle. | * It should communicate that there is very little profit taking from the players behind that candle. | ||
| + | * Thus suggesting likely continuation. | ||
| * If they were worried going into the close of that candle about an upcoming resistance level holding, or perhaps the bears may take control of the market, they would likely close their position, or take profits right before the candle closed. | * If they were worried going into the close of that candle about an upcoming resistance level holding, or perhaps the bears may take control of the market, they would likely close their position, or take profits right before the candle closed. | ||
| * But when you have a strong close with a very small wick, this usually indicates very little profit taking, thus a confidence the move will likely continue. | * But when you have a strong close with a very small wick, this usually indicates very little profit taking, thus a confidence the move will likely continue. | ||
| * This is highly useful, and will be common among impulsive moves. | * This is highly useful, and will be common among impulsive moves. | ||
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| + | Impulsive moves about 75% of the time are followed by corrective moves. | ||
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| + | * These corrective moves can either be horizontal, slightly against the impulsive move, or even slightly in the same direction, but they denote a change in the order flow and participation. | ||
| + | * 75% of the time, these corrective moves are followed by impulsive moves in the same direction as the original impulsive move. | ||
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| + | Because those who are in control, rarely give up control unless encountering a strong counter-trend force. | ||
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| + | * Even then, they usually make a second attempt to take out a recent swing high or low before giving up. | ||
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| + | Only when they fail a second time will they usually exit the market, either waiting for a new chance to get in on a pullback, or reset completely. | ||
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| + | * This is why V-Bottoms are quite rare and only form about 10% of the time. | ||
| + | * Usually there is a 2nd bottom, which is could be a LL (lower low), HL (higher low) or a similar low. | ||
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| + | This series between the impulsive vs. corrective moves will generally continue until the market encounters a counter-trend impulsive move, which usually translates to an equal or greater force on the opposing side of the market. | ||
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forex/price_action/impulsive_moves.1671115819.txt.gz · Last modified: 2022/12/15 14:50 by peter