Wow thank you so much for writing this. This is where I feel my trading level is right now, I learned so much from this post!
Notice the 'wicks' on the candlestick charts whenever the price pushed into these levels, these are levels that price did not close and 'bounced back'.
What does it mean when the price didn't close? I assume a bounce back is when it goes back to the price it was at before!
Once price had pushed out of the range it very quickly tested and even broke the measured move that was equal to the previous range.
Awesome. thank you for explain this clearly and teaching me the terminology!
My most recent trade is with XMR, It dropped to an all time low recently because of the BTC rally.
It broke the floor and then started a reversal. I placed a margin order at the low and came out really good. It is my first successful margin trade. All the other times I closed out of panic :p
Closed with .051 profits :) pretty good, feeling like I am getting better.
Good stuff!
Lets say we have a candle stick on the 5 minute time frame. This means that every candle represents a 5 minute trading time. The 'body' - the colored in bit shows the open and the close, while the 'wicks' show the high and the low. The color determines if the candle closed higher or lower in the period. If you see a candle with a large wick it means that price made a high or low that was rejected - so 'bouncing back'. Not necessarily back to the price it was at before.
Be careful with those sorts of trades, especially with the leverage you're using. You could have gotten a margin call there. That type of trade is called 'fading a move' , you want to scale in with small size first and then put more on when people are panicking the most.
Plus the more you trade the more experience you'll gain, it's better to survive, make nothing and learn than develop bad habits and have crazy P/L swings.
Good to see you getting involved :P
Thanks, Just now fully understanding the candle stick concept! Been trading all the time lately slowly making back the amount I lost back when I used to panic sell.
Thanks for the warning too! I actually learned about being careful. The hardest thing from before was to learn not to panic sell after placing the order!
Yeah always getting better! Been trading like all the time lately.