Day Trader’s Aftermarket Lounge 20 May 2020, page-17

@Veritas2000
Apologies for late reply i will try and explain , the more experienced may be able to explain better.

But basically there is a three day rule where if a stock rallies and SP has risen over three days and usually with good/large spread the third day will most likely be the last day of uptrend  before a pullback(quite often you can see it on the third daily bar, as the third bar will close lower off the high leaving a wick indicating rally is over)

Also 3 day rule can be applied to selling on the downtrend  (consider waiting  for three days of selling before trading)
Three day rule also coincides with 3 day settlement
Not a perfect science just another tool to help with decisions
Hope this helps


This was the chart i was referring to last night