This is mainly for dbphoenix to critique and comment on. Thanks.

So DB, what am I missing?

I exit after a S/D line is broken by 10 points.

Well, for one thing, you're leaving out context entirely. If you're going to trade the hourly bar, you have to take your trades off the weekly trend channel, the first op being 3/2.

Second, 10pts out of 5000 is not very important. If you had entered on or about 3/2, there was no reason to exit until two weeks later. If you had gotten a good entry on the 2nd or 3rd, there was no reason to do anything with it. IOW, leave it the hell alone. You can't trade the 60m the same way you'd trade the 1m.

If you then go long, which I don't recommend, you are not in the best position to short the failure to reach the UL of the weekly on 3/20. However, if you had, you'd still be able to go short after your demand line is broken, though it wouldn't be easy. If you were to go short there, the trade would take you nearly to the median of the trend channel.

Trading the hourly is as much about AMT as it is about the SLA. Trading in and out and in and out and in and out defeats the purpose of trading a longer interval in the first place.

"You can't trade the 60m the same way you'd trade the 1m." That just cleared it up for me so much. I see how to trade the weekly mean reversions, so now I just have to stick with that. And leave them the hell alone.

By not recommending going long once at the median, I'm guessing you consider the 'reversions' to be the easy money and it's best not to bother with the median 'excursions'. IOW, wait for the extremes?

Which brings me to my last question... You mentioned in the 07-09 bear market that AMT would have been of little help. What then?

I consider the trades from the limits to the median to be easier, largely because there are so many other people on the train, all heading back to ValueVille. Trading from the median to the extreme can be relatively lonely, and you never know when buyers are going to decide that they're no longer going to pay the ask.

As for the 07-09 comment, I don't remember the context. I don't know why I would have said that, but I must have had a reason.

As for going forward, the fact that we've been ranging for two months makes trading difficult as the SLA isn't cut out for ranges. OTOH, you can't know in advance whether you're going to be ranging or not, so you have to take the trades at the extremes, the last being 6/24. The last one, a month ago, didn't work out, but you never know. That's why you have to take all of them. This current trade may be the one that takes us to the LL of the channel, which is about 150pts away.

It was in my journal at the place where the trolls live (post #22).

As for the entry on 6/24, is this it?

I'm also curious as to the entry on the 2nd or 3rd of March. I don't see one on the second at all (or understand it, anyway) and the one on the 3rd seems like it would be stopped out?

Now that I'm really examining multiple instances of this phenomenon, I'm wondering how exactly you can tell when the 'tide has turned', so to speak, and begin looking to hop on the train back to ValueVille.

1. I don't recall what I had in mind, but it's not important. Each market top is different.

2. Yes.

3. You'll have to draw a weekly trend channel or use mine.

4. You don't. You find the extremes and either short them or go long, then exit if you're wrong.

To achieve a state of objectivity you need to operate out of beliefs that allow for anything to happen, as opposed to beliefs that allow only for the market to express itself in a limited fashion. If you operate out of a belief that anything can happen, then whatever does happen won't be threatening to you in any way, thereby causing you to avoid or distort certain categories of market information. Any limits you place on the market's behavior will be a compensating factor for your lack of trust and confidence to act appropriately in any given situation. This will be evidenced by the fear, stress, and anxiety that you will feel when the market expresses itself beyond your mental limits and you can't do anything to control the situation.

However, you do have to have some belief or expectation about the future or you wouldn't ever put on a trade in the first place. To be objective, you will need to release yourself from "demand-backed expectations" and make what I call "uncommitted assessments of the probabilities," . . . which simply means that you have no commitment to any particular outcome. You just observe what is happening in each moment as an indication of what will probably happen next.

MD