Here is a chart showing various fractals in a Dow uptrend today lasting about 40 minutes. As fractals move higher less and less, I anticipate the likelihood of a reversal. I also expect reversals at previous resistance points (today, at around 12,650) I usually won't short the market until the second down fractal in a row, perhaps following a short consolidation period. As I mentioned a few days ago in my fractal-related posting, I consider these to be add-on or entry points. I usually require my trade to be profitable to the point where, if the market reversed, I could still exit with a profit, before I will add to my position.Thursday, May 22, 2008
Trading Dow Fractals
Here is a chart showing various fractals in a Dow uptrend today lasting about 40 minutes. As fractals move higher less and less, I anticipate the likelihood of a reversal. I also expect reversals at previous resistance points (today, at around 12,650) I usually won't short the market until the second down fractal in a row, perhaps following a short consolidation period. As I mentioned a few days ago in my fractal-related posting, I consider these to be add-on or entry points. I usually require my trade to be profitable to the point where, if the market reversed, I could still exit with a profit, before I will add to my position.
