Perhaps not too relevant, but with no trading to be done for me currently, thought I would
share something that has been very useful to me in my trading for those that have an interest
in charting. I do not make much use of moving averages (or any indicators for that matter).
However, one exception is the 5 week/day Simple Moving Average.
When a given security wants to make a strong move, a "ride the 5" situation is very common
& and I have found that the first clear cut close below it is a pretty decent indicator that the
steam has run out. I often use this as an exit signal when swing/position trading. Once the
daily 5 is broken, the weekly 5 is the next level of relevance to me.
On the charts below, you will notice a dark red & a more opaque light red moving average.
The darker one is the standard 5 SMA, the other is a "step forward" version of the 5 SMA that
estimates where it will be (based on the current price) at the beginning of the next candle on
that time frame. In the chart below you can see how we are currently testing this level on the
weekly chart. That is to me, why I would be expecting some minor consolidation around
current levels.
Since the Island formation, this is the first general area I would even entertain the thought of an
entry, though that alone does not meet my criteria given current market conditions.
There seem to be quite a few competent day-traders around and they most often make up the
bulk of content on social media charting platforms (I started out like one too). IMHO retracement
trading & "bottom picking" in general, and even more so on smaller timeframes create a myriad
of challenges that few can master (utmost respect to those who have done so successfully).
With some patience and if one can avoid FOMO, waiting for more major consolidations and for
them to be resolved can make life a lot more simple. I am personally willing to pay higher prices
for my trades if that is what it takes, though it is very often the other way around.
Below is an overview of what I see as the low-risk classical-charting based (long-only) entries
that BRN has provided in the last 1.5 years (all of which I believe I have previously mentioned,
and are the basis for my positions). There are 6 very obvious ones. Clear-cut breakouts with
clear volume confirmation. Only one (in red) failed to protect a tight stop-loss. The rest provided
outstanding results.
I fully believe that opportunities such as these will present themselves in the future as well,
especially if the future of BRN is as illustrious as many hope. They may be substantially
higher or lower than current prices but they will be much easier to manage if the risk is
one's concern. I'm not sure I have ever been so excited about a company's potential but
my view and opinion on charting, trading and risk-management will not change (with the
exception of how I manage existing positions). I consider that to be both my greatest handicap
and my greatest asset as ironic as that may seem.
Just food for thought, not advice in any way and all IMHO.
GLTA
(20min delay)