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Hi everyone,
In his course, Al mentions that it’s usually better not to trade in the direction of the trend until around bar 17, since early trends often reverse or fail.
My question is: does this guideline also apply to markets that trade continuously (for example, futures that don’t have a fixed open/close like the E-mini overnight session)? Or is it mainly meant for the regular trading hours when there’s a clear session open?
Also, does this guideline still apply in very strong, highly directional markets with little or no overlap ?
Thanks in advance for your insights!
This guideline applies to any tradable instrument that has a "bar 17" that forms after whenever the time interval resets and a new trading day begins. Certain markets like those for trading cryptocurrency don't ever close but certainly this guideline applies to any instrument whose price action significantly changes at certain times every day. Futures have many new market participants at 9:30am EDT so it's best to consider Dr. Brooks' guideline for those instruments. Most instruments are affected by the New York Stock Exchange and NASDAQ open at 9:30am EDT.
Thanks a lot for the explanation. That really helped clarify the idea behind the guideline. Much appreciated!
