Chapter 11. Determining Entry Points

Now that you understand the pattern-recognition strategy and the importance of keeping a trade journal, we will begin to discuss and dissect the mechanics of an actual trade. In an earlier chapter, I briefly mentioned the two different methodologies I use when entering a trade: anticipatory or reactionary. This chapter covers each in detail, along with a hybrid method I call delayed reactionary. The examples included assume that you have already identified a potential trade and that the strategy of either going with the trend or playing a trend change has been predetermined. Let’s look at a specific example.

Assume that through your daily chart work you have come across the chart of Ford Motor Co. on November ...

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