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Hey all,
The things I learned about MM vs Exhaustion is:
The basic difference between exhaustion or mm BO is whether it happens after 20 bars into a trend or at the beginning. And even if it happens in the beginning of trend it could still be a second leg trap. So that makes the difference already hard to decypher.
And now I see Al talking in 30D (at the end) about the improving math of staying in a trade when BOs keep stacking. However it happens late in a trend. You could argue that there wasnt any bull activity in the first part of the bear trend, so exhaustion was less likely?
On top of that, I see 3 consequetive sell climaxes (parabolic wedge?) and Al still sees a 60% chance for a MM down.
Can someone please clarify?
As a bonus question. Yesterday the Emini on the 5 min had a Bull BO out of the open that was also very strong. Out of a trading range, without any bearish signs. But it still reversed down. So this was an exhaustion. But looked like it could have been a MM...I know that the open has alot of reversal chance btw, so that might be an extra counter argument here.
Im having trouble to discern if im reading it wrong or if these failures simply fall under the 40% failure chance.
Help is much appreciated!
About yesterday, if it can help, I had drawn 2 MMs: one was the entire Thursday range, and the other one was the spike started with the last bar of Thursday (I draw lines on the spy which closes 15 minutes earlier compared to the E-Mini so that spike MM could have been seen differently by others). Both were pointing higher , and I was also looking for a reason for the market to go up and test the ATH. So i saw that move that you mentioned as the second part of a MM and not as BO and a potential start of a MM, considering that it was also Friday and the last day of the month, when the market can produce big moves up and down to test weekly and monthly levels. In facts, it worked its way down to the open of the week.
I think drawing every possible MM and LEG1=LEG2 is always good because it might help to distinguish a BO from what could be "just" an acceleration to conclude a MM
Thanks for your response. So a tight bear channel is not a 75/25 chance of upside breakout? But more like 50/50? I must have missed that one.
About yesterday, if it can help, I had drawn 2 MMs: one was the entire Thursday range, and the other one was the spike started with the last bar of Thursday (I draw lines on the spy which closes 15 minutes earlier compared to the E-Mini so that spike MM could have been seen differently by others). Both were pointing higher , and I was also looking for a reason for the market to go up and test the ATH. So i saw that move that you mentioned as the second part of a MM and not as BO and a potential start of a MM, considering that it was also Friday and the last day of the month, when the market can produce big moves up and down to test weekly and monthly levels. In facts, it worked its way down to the open of the week.
I think drawing every possible MM and LEG1=LEG2 is always good because it might help to distinguish a BO from what could be "just" an acceleration to conclude a MM
Thanks for these extra clues, indeed last of the month/friday was something I didnt consider.
