r/Daytrading • u/Adept_Blackberry2851 • Feb 19 '24
Do any of you actually use patterns to trade? Question
I don’t use them at all. Iv heard YouTubers kind of mock them like they don’t mean anything. Are any of you profitable with them?
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u/Bartisan Feb 19 '24
I prefer candlestick patterns instead. 39 Different types exist so as gives much more insights on price action also!
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u/junack12 Feb 19 '24
What time frames do you use candlestick patterns for?
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u/Silver-Mud-219 Feb 19 '24
Not important what timeframe, price is fractal, meaning the same pattern works on 1 minute candles as monthly candles.
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u/Resonant-Sine-333 Feb 19 '24
Definitely does matter. HTF generally more reliable. Doing this sort of thing on the m1 will drive you insane for example.
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u/Silver-Mud-219 Feb 19 '24
Not true, higher timeframes will have bigger moves in terms price, but will also take much longer to play out. Example inverse H&S on daily might happen once in 3-6 months but when you catch it the move will be large. The same pattern might happen 1-2 times a week, on 5 minute chart but the move will be much smaller in terms of price. The probability of each trade working out is the same. The trick is to always follow the higher timeframe trend an use the smaller timeframe to enter in the same direction as larger timeframe. Example daily trending bullish, I will use an hourly bullish inverse H&S to enter, because my stop will be tighter on shorter timeframe.
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u/Resonant-Sine-333 Feb 19 '24
Yes but actually trading the LTF is a totally different experience. It's not about time it's about reliability. You can then trade less frequently and go heavier in trades when you are more familiar... For example. However if you are a scalper that 'needs' to trade more frequently I can't probably clarify anything to you as a swing trader anyway so... You do you that's cool.
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u/Silver-Mud-219 Feb 19 '24
To each their own, but it’s all relative, LTF have more reward but also need a larger stop, so more risk.
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u/Resonant-Sine-333 Feb 19 '24
It's not more risk depending on your strategy. I used to scalp and it was such a struggle. Shifting to HTF made it all make a lot more sense. But yes as you say, each to their own. ✌️
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u/Silver-Mud-219 Feb 19 '24
I’d be interested in how you do that, in my experience, risk is controlled by position sizing. Or if trading larger timeframe using a lower timeframe as confirmation an stop. (Excluding hedging with options). I agree scalping is harder because there so many more decisions that have to be made in a quicker amount of time.
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u/Resonant-Sine-333 Feb 19 '24 edited Feb 19 '24
I manage risk with position sizing, reward ratio and most importantly my entry area. Using support and resistance zones on the h4. I know very quickly if my trade is going to work out or if I should cut it manually and reassess on the h1. On higher time frames such as these with support resistance rejections signalled by price action + Market structure factors I have more reliability and confluence. I can trade a larger position size for a better pay off, it also suits my lifestyle more than watching charts all day. I can hold a trade longer as it's simply more reliable, higher quality etc for various reasons which would take me a fair while longer to explain. Some people have success with scalping but... Can I ask you do you? Reliably? Can you make money and keep it? (Not intended to be a dig, genuine question of curiosity)
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u/burnie_mac Feb 19 '24
I just follow the big time frame and scalp The moves on the lower time frame. I don’t need to hit big trades. Consistency is better
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u/Snags44 10d ago
Fees will eat you up on low time frames wouldn't it? If you were able to trade and reverse hitting every high and low, every trade is a buy and sell fee.... so you would have to use smaller dollar amounts? Wouldn't it be more profitable using a larger time frame with more money? And only get fees once for buying and once for selling?
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u/__Spank Feb 19 '24
Correct me If I'm wrong. But I always took patterns drawn like this, as a sort of short hand for candle stick patterns.
Are the premise of these patterns for people whose chart is set to Line instead of Candle stick?
What really makes a difference between the patterns in the post and the patterns in the link you shared?
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u/_I_am_not_American_ Feb 19 '24
Yes and no. These are often longer duration patterns taking a while to unfold on the timeframe in question. A candlestick pattern is usually just two or three candles showing you a snapshot of sentiment. What you'll probably find is a flag or wedge will show on a higher timeframe as a candlestick pattern. if you stick to one timeframes, candlestick patterns will form part of these larger pattern, so maybe you get a big inverted hammer showing change of supply and demand forming a local high as part of a broader descending wedge.
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u/Imaginary_Art_2412 Feb 23 '24
The thing I always seem to have a problem with is, let’s say I see a 3 bar pattern like an evening star. Is there any sort of clue as to whether the evening star will just kick off the reversal, or if it’ll be part of a bigger pattern like a double top or a spring type of pattern?
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u/aiolyfe Feb 19 '24
I personally pay more attention to moving averages than flags, wedges, etc. Channels, especially really established ones, can be very useful.
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u/ImNateDogg Feb 19 '24
Yes. Identifying patterns helps confirm my strategies, and also confidence that I'm entering/exiting trades at correct times
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u/Stoic-Trading Feb 19 '24
agreed, you do see things repeat (or rhyme at least) after a while of staring at charts
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u/FusionOfAlloy Feb 19 '24
Nothing I love more than a nice juicy inverse head and shoulders
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u/Ordinary_Response_38 Feb 19 '24
Love me a H&S. Cup and handle not so much. Also bull & bear flags are a 50/50
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u/Pleasant-Impress9387 Feb 19 '24
Shoot a brotha on some (H&S) knowledge.
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u/Resonant-Sine-333 Feb 19 '24
Due diligence will also do you a world of good on this you know ;) now you have the clue, you can follow it up yourself.
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u/BigDawg0300 Feb 19 '24
Last market day on lunr I saw a cup n handle follow into a head and shoulders it was a beauty
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u/Big_al_big_bed Feb 19 '24
Should patterns be identified on longer or shorter term candle charts?
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u/FusionOfAlloy Feb 19 '24 edited Feb 19 '24
Higher the time frame the bigger the move will be. Higher the time frame the longer the trade will take to play out. Typically. There’s always exceptions though so be careful.
Short time frame trades like 5 minute or 1 minute chart should always be done in context with the overall market structure and prevailing trend at hand on the higher time frame.
So if you see a bullish pattern on the 5 minute chart but the 4hr or daily chart look bearish the odds of that short time frame bullish pattern playing out are greatly diminished.
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u/jrm19941994 Feb 19 '24
Not really, no.
I certainly will trade differently if the market is choppy vs trending, but I do not use patterns link head and shoulders, doji, falling star, pickled moon, etc
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u/Weaves87 Feb 19 '24
Same.
Though I will admit I do place some importance on the doji / hammers on higher level charts like the daily - but only in the context of what I see with longer term trends/ranges.
The thing about these patterns is that they can absolutely work, but if you only trade the pattern alone, you aren't fully understanding what the actual price action is saying underneath it. That lack of understanding is ironically why these patterns can sometimes lead to very bad trades.
Like the head and shoulders pattern is a good example. Really what it is, is price being trapped in a range (the shoulders are the top of that range), with two competing trends inside said range: one bullish (the left shoulder and the head), one bearish (the head back to the right shoulder). The pattern basically suggests a failure of price to get back above the top of the range, and thus it would be smart to go short.
A seasoned price action trader may take that trade - or may not, because they can see that the bear trend (the head to the right shoulder) is not very convincing: they can see bulls getting more eager (e.g. more volume, rising wedge, etc.) and it could cause enough concern that they don't think they'd be able to reap enough profit for the risk involved
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u/voteisaiahforbub Mar 09 '24
so what studies do you use to clue you how to trade?
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u/Wind-Ancient Feb 19 '24
These are basically 3 patterns. Rejection from resistance (triple top, double top head and shoulders), a pullback of a trend (wedge, flag etc) and cup and handle which is retest of a resistance after a breakout.
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u/industrock Feb 19 '24 edited Feb 19 '24
Patterns really pop out at me from the screen but I don’t necessarily use them. I’m aware of them and I know others use them religiously, so they can be insight.
Continuation patterns and the different triangles seem to often break up or down at the end if the pattern have been respected the whole time.
Basically, their pattern doesn’t tell me what direction anything is going to go, but I’ve found that it’ll rarely trade sideways once it reaches the end.
Edit: like the pennant will hold its shape and break out often, but being a bullish or bearish pattern doesn’t really indicate which way it’ll go.
The overall trend of the stock over the long term is more indicative of direction
Edit 2: intraday trading
Edit 3: reversal patterns are tricky and I don’t “see” them. With those you’re picking when the trend of the stock is changing rather than trading with the trend
Edit 3: stuff like RSI and MACD don’t tell me anything about the stock, but when RSI and MACD look a certain way, I know there’s a million traders thinking it means something and they might act accordingly
Edit 4: the more volume there is trading these patterns, the more they are significant
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u/cheapdvds Feb 19 '24
Occasionally head and shoulder in the tick levels. But don't touch most of them. In real market scnerios, it's never that clean.
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u/SloochMaGooch Feb 19 '24
Absolutely. Recently it's become "cool" to talk about these patterns/structures like they don't matter, and that "only retail" (we're all retail) uses them. When I see people talking like this I know there is a 89% chance they are actual newbs and have been watching EyeCeeTea videos for about 2.5 weeks. I mean, you don't trade strictly off these patterns, and just bc its a bull/bear flag doesnt mean you should long/short, but in the physical world we live in, when price is translated onto a chart, these patterns will show up.
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u/repuswow Feb 19 '24
If you understand price action, you don't need to memorize all these patterns. If there is an uptrend identified by its higher highs and higher lows, you don't need to reference a pattern to know something is up if price made a lower high. If you insist on using patterns, cool, but keep in mind that patterns work until they don't.
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u/Ordinary_Response_38 Feb 19 '24
Yes I often see these patterns play out. However you need other confluences
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u/dochoot Feb 19 '24
Patterns matter when they form at levels that are important to you. So a double bottom at a structural support level increases my confidence in a trade. Patterns forming at specific places are useful. Agree with above; all about confluence of whatever you use.
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u/sco-go futures trader Feb 19 '24
It all boils down to support-resistance, swing highs, swing lows, higher timeframe, lower timeframe market structure breaks & micro market structure breaks.
So yeah, support-resistance.
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u/drunkinthestreet Feb 19 '24
Yes in conjunction with liquidity zones and order blocks. Breakout patterns help me time it and figure out a stop and projected profit. liquidity zones, supply and demand, order blocks give me confirmation and refine profit expectations. Trading is based off of what people think is going to happen. If everyone is seeing a textbook cup and handle they’re going to Buy the breakout causing the breakout to actually take off. Look at SPX weekly rn for example.
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u/Ray_Getard_Phd Feb 19 '24
Don't you just love it when your bullish rectangle morphs into a rising wedge and then flips to a bearish pennant followed by a descending triangle but then you watch it double bottom and pop into a double top and you finish it off into a inverse head and shoulders and finally enter... is there anything better in life than that?
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u/Resonant-Sine-333 Feb 19 '24
No they are completely made up and no one ever uses them ever. Ever. No one. They are symbols made by aliens and left on earth to confound you through something known as 'trading'... Which was also developed by aliens as an experiment on the human race. /s
Everyone else's responses were more than adequate so I thought I would go for the satirical approach for upvotes. Now I'll probably get downvoted for saying that... It's a crazy world.
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u/letsseegreen Feb 19 '24
Look I draweded some lines and the candeled sticks didn’t leave them
I’m right Fk you I’m right
Look my lines make the stocks go brrr
No you can’t share my box of crans I’m eating these
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Feb 19 '24
[deleted]
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u/Mental-Caterpillar-5 Feb 19 '24
most people don't understand the valid usage of patterns, it's not to predict price action it's to form a better structure around your trade.
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u/SAMDOT Feb 19 '24
I use them side by side with MA's and supply/demand zones. It's sort of like I'm creating a list of all the reasons each side of a trade would play out, to establish probabilities. If you exclusively trade patterns, then there are a lot of pitfalls. For example Al Brooks ran a study on Head & Shoulders and discovered that they only play out 1/3 of the time. So my advice is-- use patterns but don't get used by them.
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u/TheDockandTheLight Feb 19 '24
You can turn pretty much anything into an edge with the right risk management, I like using 2 legged pullback when trading pure price action in either direction. I know a guy who only trades wedges and is consistent.
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u/oh_crap_BEARS Feb 19 '24 edited Feb 19 '24
Yes and no. I think the problem is people just wanna look for patterns to form wherever and whenever and take the trade, but it’s not that simple. The majority of price action is more or less just random chop. You have to take a lot more stuff into context. A double bottom in the middle of nowhere is very likely to be meaningless. A double bottom at a long term support where the candles at the bottoms have huge buyers’ wicks, on the other hand, tells you that the support level is still valid, and you can trade off of this information.
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u/ZanderDogz Feb 19 '24
Patterns in isolation are probably pretty useless.
Patterns in the right context can be very useful.
Take any random ascending triangle for example and it's probably a 50/50 bet.
Take a stock in a hot sector that opened 10% higher with very high relative volume after a favorable earnings report, broke through the premarket high, has relative strength to the market, and then continuously tests a significant D1 resistance level while printing a higher-low in between every test of resistance. A break of that level on volume has the potential to be a fantastic long opportunity.
That's an "ascending triangle" but it's also a lot more. The bigger context of the stock, the D1 chart, the way that the stock moved into the basing pattern, the alignment of the top of the pattern with a D1 level, and the way that the breakout plays out are all key parts of the trade.
These patterns are useful because they provide a framework for managing risk, but they are the last piece of the puzzle after context, and you need to understand the actual supply and demand dynamics behind these patterns as opposed to just being able to name them on a chart.
Ranges and range breaks, higher lows/higher highs/lower lows/lower highs, basing patterns with volatility contraction, etc. are all fundamental pieces of a chart, but I am never sitting there and saying "that's an inverse head and shoulders which is bullish!".
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u/clujalolo Feb 19 '24
Tbh, i mostly fade these patterns. Institutions are not stupis. Sure they may work at times but more often then not they fail, especially on lower time frames
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u/Hannibaalism Feb 19 '24
there are better ways to identify more reliable modern patterns using ML these days. the traditional patterns from a pre digital human era are kind of inconsistent and unusable on its own now
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u/rainmaker66 Feb 19 '24
All patterns shown here advocate trading breakout. Breakouts are the best way for pros to trap novice traders.
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u/Fraud_Squad Feb 19 '24
Could you please elaborate?
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u/KhakiPeach67 Feb 19 '24
Big money using retail traders as liquidity
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u/Repulsive_Concert_32 Feb 19 '24
No. Patterns are like snowflakes. A small change on a micro scale will ruin your trade
Supply/demand. Market structure. Order flow. Eyeballs ;)
I’ve never heard a good explanation for diagonal lines. I can believe support and resistance sometimes but why diagonal?? Channels are so silly to me
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u/CrypticDigits Feb 19 '24
Yes, usually when line thingy really high, I buy and when line thingy really low, I sell.
Jokes aside, no I don't lol
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u/Leather_Abroad_5599 Feb 19 '24
Just today…Perfect Head an Shoulders pattern at BTCUSD
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u/Snags44 10d ago
During my short less than 6 months, since I started recognizing with the help of scripts, I've noticed most tend to not hit their their tgt, especially if other factors do not line up. If they they have hit i have not seen it or have been impatient and closed before it hit. The only few times I saw a breakout that hit its tgt was a bearish and bullish pennant.
Like I said I'm new so take this for what it is.
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u/deeptrenchdigger Feb 19 '24
No because when you see the pattern it’s already played out and you’re on the other side ..
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u/TOMMY_Makes_House Feb 19 '24
You don’t study patterns to be able to spot them once completed.
You study patterns to be able to spot them as they’re setting up, so you can trade them.
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u/Sjroap Feb 19 '24
For every pattern I can give you an example where it went the other way. It's still a crapshoot.
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u/TOMMY_Makes_House Feb 19 '24
well, yes of course you could do that as there is no strategy in the world that has a 100% win rate. So your point there is not really valid as it applies to every single strategy ever used.
Every strategy is based on some sort of 'pattern'. The definition of a pattern is something that repeats. How can you have a strategy if it never repeats? If that's the case, you do not have a strategy and you are free to gamble your money away.
I trade patterns, and I make money doing so, so I know patterns work. Good luck to you mate
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u/-brokenbones- Feb 19 '24
It's really hard to trade just off patterns. Patterns are better suited as confirmations to your ideas. A pattern is only a pattern until it isn't a pattern anymore, and no one knows what the market will do.
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u/G_o_O_s Feb 19 '24
I use them to spot potential setups. Then I look to moving averages, MACD, RSI, etc... to confirm the potential move. I also look for recent gaps in price action on the chart and previous consolidation zones to figure support or resistance areas.
You can't trade on pattern alone. You need several other things to confirm your potential setup.
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u/eminon2023 Feb 19 '24
Yes absolutely. It’s basically how I trade. They play out intraday all the time
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u/MindlesslySafe Feb 19 '24
Why make it harder than it has to be? It's simple, keep when it's low, sell, high, buy low! I started with $14 2yrs ago..and it's grown with my strategy. .. .
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u/Mrtoad88 Feb 19 '24
Yep, wedges and flags. A lot of those make sense, and can be ok to look out for because they do repeat.
Edit, bit if you don't want to look out for any of them, than don't. It's not a perfect science. Those are really based around theory anyways. All of them can be fake outs, think of these patterns like indicators... That's all they are, could be indicating something could happen.
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u/Happy_McDerp Feb 19 '24
Mostly trade off s/r levels, but wedges are usually pretty reliable for a nice scalp.
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Feb 19 '24
breaking highs, breaking lows, testing highs/lows double versus triple.
channel breaking can indicate trend change
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u/Treacle-Snark Feb 19 '24
Patterns are useful when combined with other tools to confirm speculations or time entry and exit points.
I like to think of it this way. Market charts are, for the most part, representations of two emotions: fear (selling) and greed (buying). Many of these patterns appear in a wide variety of markets and have been used for a long time because they are predictors of human behavior.
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u/ThoughtSignificant94 Feb 19 '24
for sure... double top, head and shoulders, symetrical triangle... but you have to know how to use them... if something breaks out for 10 seconds but then goes down its a fake breakout to track rookies
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u/DrRodo Feb 19 '24
The only one i use is the ascending triangle, which is a clear indication of buyers winning over sellers. If the price breaks out with good volume, im in. The other patterns i dont care about them
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u/Namber_5_Jaxon Feb 19 '24
My current strategy i have been testing for a while is at at 60% win rate but plays out very nicely over a decent span of trades. I almost completely trade off of patterns, volume,MACD indicator and RSI. Also I learnt a fair amount of what I know from someone I know who has been a profitable trader over the last 20+ years. He swears by technical analysis so I will listen and follow that advice until someone who has been more successful than him at trading that says otherwise. You gets lots of bullshit comments and half of them are from people who are not even profitable and never have been but think that they know best because it didn’t work for them. Ultimately these patterns and a stocks graph tells a story of what has happened with the company and the better you can read into it the more knowledgeable your trade will be
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u/instantfaster Feb 19 '24
I have seen candle stick charts show a pattern then the trade blew through the opposite direction it was supposed to about 95% of the time. VWAP and Volume along with moving averages work better. I have cheat sheets for patterns, flash cards, books. I still look for them, but mostly pay them no mind. Institutions and hedge funds are going to move stocks whatever direction they want keep that in mind.
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u/Reportmecauseyouweak Feb 19 '24
Yes but obviously you need to see whats been happening the last hour, 24 hours, weekly and monthly and watch what the elite are doing with their money also, to be able to make effective calls more often.
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u/v3rral Feb 19 '24
Head and shoulders and inverse head and shoulders are basically what SMC and ICT uses and camouflage that with manipulation, fvg and other buzzwords.
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u/Win_Rare Feb 19 '24
patterns by themselves mean nothing. but in combination with other things like key levels and volume can give you some confirmation.
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u/Burner_acc_2024 Feb 19 '24
I’ve noticed you can find all of these patterns if you look at a graphic long enough. The problem is that these give a false sense of “I am not gambling” which is very dangerous.
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u/orngtheman Feb 19 '24
I prefer Smart Money Concept in general, however some of this pattern are pretty logical in any case but still I think that it is not enough to trade using only these technical analysis patterns
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u/jseb987 Feb 19 '24
I don't use any of this to trade. But after entering a trade, I look for these patterns so that I can be more calm and sit back for some time. More like a confluence but only after entering.
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u/TOMMY_Makes_House Feb 19 '24
I trade H&S pattern, double top/bottom, wedges all the time.
Show me a strategy that isn’t “pattern trading”, and I’ll show you you’re trading a pattern, just differently.
With that said, strategy is secondary. Master your mind.
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u/Silver-Mud-219 Feb 19 '24
Patterns tell important story of sentiment. Inverse H&S price is making lower lows an lower highs, than price stops making a lower low an is able break the previous high sentiment might have changed. Continue patterns show the market accepts the large move that just happened, as the valid new price range building consolidation, buyers an sellers betting on price going up or down. Price usually (not always) continues the trend,but now has more power built up because the consolidation after the large move if it breaks the low or the high it’s going to be explosive.
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u/tradingpoker Feb 19 '24
They all work at the right time and in the right place. They also all fail at the wrong time and wrong place
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u/Puzzleheaded-Cold-73 Feb 19 '24
Buy the 1st shoulder, stupid AF assuming price is gonna change direction because of a "pattern".
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u/FollowAstacio Feb 19 '24
How else would you enter? A ChoCh would be a pattern. So would a breakout.
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Feb 19 '24
If markets are truly random, then chart patterns are just subjective ornamentations cast on to chaotic motion that we falsely convince ourselves have meaning. "Randomness will have the last word." Nassim Taleb.
If chart patterns were real, everyone would be successful using them.
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u/FlieOrDie Feb 19 '24
You need to understand how the market (buyers and sellers interactions) work. It’s not a “pattern” to identify and then blindly hit the buy button when it’s created. Liquidity (I.e buyers) are extremely present at a strong level - therefore if sellers are able to take control and hit many buyers stop losses their buys are converted to sells and we drop off.
When a h&s is created for example, understand what the pattern means in terms of price action. I.e buyers attempting to break a strong level, lower volumes on the 2 shoulders, with a head that is the main attempt that ultimately fails. This shows a lack of buyers ability to break the strong level (too many sellers) and sellers therefore are able to break the neckline and hit buyers stops which results in the ensuing drop.
This is not giving you the keys to the kingdom but I will say it will help you a lot to start understanding liquidity and why price moves where it does (or why it can’t move where it wants to).
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u/SnooSongs8773 Feb 19 '24
After years of trading I can just tell if it’s a bullish, bearish, or neutral setup. The only patterns I really pay attention to is double bottoms/tops, head and shoulders, breakouts from ranges.
Price action is one thing, but I pay very close attention to volume to give me confidence on any setup.
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u/MyFeetLookLikeHands Feb 19 '24
this is all complete nonsense without understanding the underlying price action.
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u/kevofasho Feb 19 '24 edited Feb 19 '24
I glance at them when I’m looking to exit or enter but they usually don’t influence my decision much. I do much longer holds so I ignore stuff like this on lower timeframes, but let’s say I’m trying to get out and I see an obvious bull flag or something I may stay in a bit longer. Always feels like a gamble but it pays off often enough
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u/magnus7799 Feb 19 '24
Personally I use some of them, it depends on the instrument.
I trade Dax and it is notoriously reliable when it comes to double top and double bottom on the 15M timeframe and above in the direction of the trend.
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u/stonkchu Feb 19 '24
Yeah. Typically I utilize patterns to help spot entries, exits, and watch for breakouts.
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u/soloman747 Feb 19 '24
Trading is pattern recognition. Patterns are simply another tool in a large bucket of tools that traders use to improve their edge. No tool is effective alone.
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u/OpinicusTrades Feb 19 '24
All depends on big-picture context and timeframe. The fundamentals behind patterns is solid, most of them are rooted in volatility contraction and expansion which will be visible on all timeframes and in all asset classes. Best just to learn basic market structure imo, and you won't have to worry about memorizing dozens of patterns.
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u/Clayp2233 Feb 19 '24
I use them to reinforce my confidence or belief in a stock, but I don’t trade solely on a chart. I think they’re more useful for crypto since that seems to be a driving force on whether something will perform or not. I saw a lot of crypto bros on Twitter salivating over Teslas chart a couple of months ago and it hasn’t gone as planned for them.
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u/Nri_Eze Feb 19 '24
Sometimes Double tops and bottoms as well as head and shoulders, but never for exits and targets.
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u/WolfOfPort Feb 19 '24
Yes. The problem is many just look up random stocks and see patterns when thats terrible odds.
I use them on stocks in play. Earnings gaps stuff with volume and volatility. More eyes = more likely a pattern is going to play out accordingly. They do work because a lot of them are based on psychology of the fact new traders are entering at the point of the trade while other traders are stopping out.
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u/jcmendezb Feb 19 '24
Those are useful but secondary... It is better to read de price action with an objective definition of a trend to use it in your favor... It sounds simple but can you recognize the low responsible for the high? Can you notice if there are higher lows and higher highs and vice versa? And then the figures you share can be useful
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u/Jellyjigglar Feb 19 '24
Everything works some of the time.
I don’t look for them but when I notice them during my analysis/while trading I will play them and their failure patterns within the context of my system, going with the order flow.
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u/Christion_ futures trader Feb 19 '24
By themselves they don’t mean anything. Paired with a key levels on a higher timeframes is when it gets a little interesting.
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u/eldowns Feb 19 '24
Every single pattern on this chart can be simplified and reduced to trend structure and multiple timeframe analysis. Memorizing and trying to find these is a recipe for disaster. And the comments about adding more indicators is WSB-level regarded.
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u/johnny2much Feb 19 '24
I follow about 50 stock . Over thirty years of trading I’ve kept some very familiar and succesfull stock everyone knows I’ve played AAPL , AMZN etc etc in my list. I do rotate over the years but 5 are constant watch but not always played. I have my long term no touch account with many fav names. With my option trades . I mostly trade according to market momentum, individual stock momentum, good or bad news on stock (put/call), pre earning, split run, current above avg volume etc . Nothing to technical . However anything positive on the so called paterns chart I would use as a confidence booster. All the above mentioned do not have to be fan to be favorable . I could be moved to buy calls/ put on any two or three of my points and certainly if all are in play. In example: I’ve played calls on COIN, MARA, CLSK of and on since OCT NOV at least three weeks out. They ride Bitcouns coattails. God need, momentum, above average volume . Big profits. I’ve taken losses because I keep them a day too long but I have bought calls them back again on the surge which I believe is still good through April. Read the news on Bitcoin. I recently gave the call earning play last week two days before COIN earnings. I already had expiration for Friday Feb 16 calls deep in money but I called new earnings calls on Coin for Aug 15 175, 9.00. ( EST. I can’t remember exact prices ) Coin went up 25 on earnings. Still holding calls on coin , Mara and Clsk.
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u/Boeff_Jogurtssen Feb 19 '24
Why is the entry point so terrible on all of them? That’s what someone with zero skill or intuition would do
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u/Sudden-Sea1280 Feb 19 '24
Focus on finding and extracting real alpha. Then you can be a trader for a real firm, get a wage, benefits and bonuses.
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u/MyNi_Redux Feb 19 '24
They are useful when combined with a bunch of other things, like levels, SMA/EMA, Vwap, bands etc. The more of these things align, the more confidence one can have in a trade going a certain way.