KNOWLEDGE / PRICE ACTION
Price structure, levels, bumps, formations and compression of variation.
A level can come from a prior swing, a range boundary or a repeatedly traded area, but those choices are not interchangeable. State how the zone was selected and what would make it obsolete. The width should reflect the price scale, tick size and recent…
Specify the reference range, timeframe and what counts as a completed break. A wick, a closed candle and several minutes of trading outside the range represent different conditions. Record how far price has already travelled when the observation becomes…
Two similar lows form a visual candidate, not a completed upward reversal. The intervening rebound defines a reference whose break may provide confirmation under a chosen rule. The mirror applies to two highs. The lows need not be identical, and insisting on…
A flag interpretation begins with a directional impulse followed by a contained consolidation. Describe the impulse's size and duration, the pause's range and the fraction of the move retraced. These measurements are more useful than insisting on a perfectly…
Compression describes reduced variation, not a guaranteed expansion or a known direction. Compare recent true ranges, realised returns or band width with a prior reference for the same pair and timeframe. State the lookback explicitly. A small candle in a…
A retest is a return toward a previously crossed reference, but the acceptable distance and waiting period should be specified. Price need not touch an exact line to test the same area. Decide whether your rule requires a closed candle, a rejection sequence…