RE: Awesome PAY trade yesterday, and how to use Volume on a chart
I understand your question.. Heres the problem, its not as clear cut as you might like.. You can guestimate where the base is.. maybe its near the bottom of the wick, or maybe its closer to the body, but it depends on where the buyers came in.. in this chart it looks like it was nearer to the body, but not anymore.. You have to see it from the perspective of market reaction.. you need panic to buy in.. without panic, if you buy, you could be buying a grind lower.. thats why you want a large bounce, to show you strong buyers and to help you identify a base, and then, later when it cracks, you need to see a panic drop.. then you know your getting in at the right place.. so in the chart above, the bounces are starting to get smaller and smaller off that support and therefor disqualifies it as a base, because the coming crack is getting obvious to everyone..
Thanks for the reply Luc. While i think i
m starting to understand several things (like for example the need of a good bounce back in order to qualify something as a base) i think since bases are crucial in order to trade like you it would be useful for me and others which are following you if you can create another video talking just about bases in more details and maybe even showing examples of the different ones (bottom of the candles or the stick so to speak). I think having a "dedicated" video teaching just how to determine bases will be super helpful since if we dont determine the right one we can get stuck on a trade longer than we want. I recognize that determining the base is my biggest drawback currently as it `s not as easy as i thought so and help in this regard from you will be much appreciatedI also want to ask you about timeframes. For example if i
m working on an one hour chart -what if the base wont be "cracked" so i can buy? Unless im missing something -which i think i do :) my concern will be thati will draw my bases set up my buying spots and then realizing that if the bases wont get cracked the day can easily go off without any trades. Can you please explain how those timeframes work ?