- Steven
- Jan 9
We continue to explore momentum and structure and how their properties both at times oppose and align. The broad averages and trends inherent in structure are slow to change, slow to update, which contrasts against the quickly changing nature of momentum: price never reaches equality, interpretation exists for more than a single wave. Equality found in structure averages together many waves essentially ignoring momentum until its large enough to move the trend or averages. The difference between these interpretations and the trading strategies creates a new opportunity for us to exploit.
Good Trading
- Steven
- Jan 8
Our insight into momentum and volatility has generates a few ideas. We have taken the law or essence of momentum and having fully embodied the perspective found a rich source of nourishment. The way price action unfolds itself and is naturally understood through momentum is so contrary yet in a few ways I have already seen how complimentary it is to our standard approach.
Today after reflecting and talking out the ideas we have reached some definite and testable conclusions. Three pairs were analyzed, the best we could at this moment, which we will come back to tomorrow to see how we did. I will also be looking at all my other pairs through this lens and aiming to trade many small positions to become more familiar with the new ideas. I aim to take at least small 10 positions today and tomorrow.
I am looking currently at the eur/usd and noticing 1.1678 being a key area on the 5min chart.
Good trading.
- Steven
- Jan 6
We analyzed a few pairs today going through the two from yesterday. Price is developing nicely on the eur/$. As i write this its testing 1.1730 that previous trend line and 78.6 fib area. From here the bearish wave will attempt to resume its trend to the downside whereas structure broadly will be attempting to establish higher-lows. These two ideas will come into conflict sooner or later and it is this conflict that might produce some opportunity for us.
The $/chf was squeezed slightly into the lows at 0.7910 where we were looking for bottoms and an s-wave. We found our bottoms but no entry pattern. In hindsight we can see across the waves moving into the trend line deceleration into the lows, an increase in volatility on the second bottom and a higher low test. In absence of structure our speculation must then rely on information pulled from volatility changes. It's a more fluid and spontaneous type of analysis that emphasises movement in the present moment; thus momentum is key. The conclusion 'trade off the lows' is bounded by momentum. The position is over when price is no longer moving off the lows. Compared to structure where price is permitted to move around in broad spaces either direction yet still carry throughout the whole pattern some underlying properties. In here we find again that common distinction that permeates life; discrete units vs a connected whole or particles vs waves.
Good Trading.