Day traders' after-market lounge August 5, page-18

@buddi there's many setups, but I'll run through the 3 you raised . All are plausible as long as you understand the risks, targets, expectation of performance after entry and failed exit plans in place.

With your examples ;

1)No supply or Exhaustion + Consolidation + Large demand bar

*Assuming you would be entering within an established trading/consolidation range (we'll call it TR).. on the next higher vol demand bar assumes the start of the next little swing towards the top of the TR
* The idea is if you enter within the box, the risk assumption is to assume that the breakout would fail therefore set exit on resistence towards top of TR/TL and re-enter on the breakout of appropriate.

*Set exit towards the top of the TR/TL and stop below entry or below dominant candle.

2) No supply or Exhaustion + Consolidation + TR Breakout entry

*Entering after the breakout signal of the TR/TL would set a target of the depth of the range/pattern if it's broken up or towards the next key resistance point.

*The idea is that the bulls have revealed signal/confirmation of assertion on the absorbtion/accumulation over the consolidation period and would aim to mark up prices higher, atleast the depth of the consolidation pattern

*Set exit/stop if breakout fails.

3) Exhaustion + Consolidation + Large vol demand bar + restest of lows
*This scenario wouldn't be common in an uptrend but if it happens in the downtrend I'd pay attention to where the lows are.Also Did you mean to point out that the low supply test should occur first before the large vol demand bar? as this would make more sense from a risk and performance expectation perspective.

Idea is that bulls are relatively hidden in this setup due to downtrend (hence restest lows). Athough may step up at various stages in TR.. theh quickly lose assertion, letting prices drift lower to retest for supply at bottom TR support.

*Keep in mind If the lows/support you mentioned are below the support of that demand bar, integrity of the demand bar is questionable.. we question whether the price is weak enough to fall below this bar again. Pullbacks or consolidations should ideally be above half of that bar or at worst case the lows of that bar (whis is also a potential entry point). I would want higher lows after the high demand bar. For this reason if prices drift below this bar, id wait for the supply test to be complete before entering (aka supports hold or fake breakdown followed by spring back up above support)

* Set entry on support of TR and stop below spring or entry on the PB of demand candle and stop below .



Personally If you ask me, I'd DT strong uptrending stocks 8/10 times and id pick the second setup above (I.e breakouts) .. as it's one I'm personally more familiar with and found sucess with as I dont like trading in between the consolidation setups as much. Unfortunately breakouts in this cycle of the market have been more sketchy but that's OK as I've doing alright at picking out the weaknesses early more often than not and exit accordingly.

If I enter on lows/support for other setups, it would be for a short swing/bounce/scalp. For STT the approach would be different though.


Most my trading comprise of trading darvis boxes, trading ranges or continuation patterns (triangles, flags, pennants etc) as you've seen me post alot of charts on. Hope all above makes sense.

Cheers.