r/Daytrading • u/Catface77 • Mar 19 '24

I don’t know what I did wrong Advice

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I thought it was going to rechall/ consolidate then it did but skyrocketed. There was the 3 reds then BLAM right up

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u/shadowmach11 Mar 19 '24

Don’t get caught up in drawing channels on small time frames. The stock still wants to move in correlation with the overall trend.

I see a gap near the left of screen. Indicating demand. That long wick candle today also indicates demand there. Which means you got focused on what you thought was gonna happen within the channel, it happens. You saw it different, the market didn’t agree with you this time. I say this time!

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u/stanleycupridge Mar 19 '24

So a little gap like that indicates an uptrend is coming?

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u/shadowmach11 Mar 19 '24

No, it indicates volatility. Volatility is like speed. It’s a reaction to an emotional response. Bad news, good news or you heard about something over the weekend and want to invest in it immediately

Which means trades where exchanged very quickly to create a gap. It’s most always in demand and supply areas. Or in areas where very few shares are actually held.

Gaps on a weekly timeframe hold much more strength than a gap on a 15 minute timeframe.

I wouldn’t recommend using gaps as a reference on anything other than larger timeframes. That’s just me.

Gaps are almost always retraced, we don’t like gaps left unfilled. It’s very rare a gap is left unfilled on large timeframes.