Are we trending or breaking out in marketsFeb 15, 2021
Leveling up in trading is hard to do. Mostly because the right things to be focusing on aren't that obvious. You would think that just finding a good trend and riding it to the very end, from the very beginning is all you have to do. Sound simple enough, right?
Except markets launch breakouts which FAIL 80% of the time, only 20% of the time do markets actually breakout and trend. So if you are always chasing breakouts, 80% of the time you will be getting stopped out.
This is what creates trading ranges, breakout traders jump in on the first breakout attempt only to have the trade turn around on you and drop back down into the trading range.
What looks like a trading range is actually numerous attempts to breakout from the trading range.
Notice how many spikes above the range show a big reversal candle, with a big spike shadow/wick on the candlestick.
Here's a closer look
Since late August of this year the EURUSD has been breaking out above the trading range beautifully, only to reverse the next day and drop back in to the trading range. In fact today we have another one of those beautiful breakouts
You'll also notice that it's made just as many solid breakouts below the range, again only to reverse and drop back into the range.
The old saying of higher highs and higher lows signal a trend up, and lower highs lower lows signals a trend down, doesn't apply in a range bound market.
Here's the thing, eeeeeveryone is chasing these breakouts that trend, but the vast majority of the time, they bang around a range, convincing traders that they are breaking out, with a new higher high and lower low, only to reverse on them yet again.
Day after day, week after week, failed breakout after failed breakout, the account gets smaller and smaller until finally the trader gets tired, and moves on to another market.
This is about the precise moment that a breakout occurs. When the least amount of traders are paying attention to the market, and the market doesn't require as much volume to push it higher.
And kaboom, the market breaks out.
Which leads us to our next conundrum.
By the time it's obvious that the market has broken out, we are fearful that it doesn't have any longer to run, so we wait for a pullback to buy into the trend, waiting for a juicy pullback to buy. Except when the pullback comes, it isn't deep enough to be considered a "proper pullback" and so we watch as the market just keeps running.
Then the next pullback opportunity comes, and this is a good "proper" deep pullback, except this time it's too deep and you are convinced that the run is over. Only to watch it rip higher from there.
Bitcoin this past month is another great example of that
Even all of 2020 was a buying opportunity
There was a period from May to August where the price traded sideways from 10k down to 9k, frustrating traders endlessly.
And today, at this very moment, BTCUSD is trading at $18,850.
In the Trading Lab we've been all over these trades, not just identifying them correctly and capitalizing, but building strategies to trade these.
From the FVBO, to VBO, VBO2.0, Price Action and the strategy I shared with you yesterday which is up almost 600% this year alone.
Imagine if you knew what was important to pay attention in markets, and had the mentorship, guidance and team work to help you realize what isn't important to focus on.
Imagine opening up a trial account at a prop trading firm, again, for another couple hundred bucks, AGAIN, but this time successfully completing the try out requirements and getting funded with hundreds of thousands of dollars!
Imagine finally being a FULLY FUNDED PROP TRADER!
We have cracked the code here at Pollinate and I want you to crack it too.
We will be running a Black Friday/Cyber Monday deal which I will be announcing soon. Do be sure to read these emails, I will also clue you in on what we are looking at in this upcoming MAJOR MARKET REVERSAL
Learn the details that are truly important to successful trading in Consistently Profitable Trader.
Learn how to identify edges, how to test them, and build our own Trading System in the Systems Mastery Course. Literally take the tryout parameters for a prop firm and build your own strategy to hack their rules.
Collaborate with other prop traders on what they did to get funded, and other traders trying out for prop firms (currently) to learn what to expect and what is/isn't working in the Trading Lab
P.S. A lot of you have been emailing in asking about joining a prop firm and if buying the Systems Mastery Course or joining the lab is the right move. We do have something special planned for Black Friday/Cyber Monday, so keep an eye on your inbox towards the end of the week!
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