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Entry/exit during quick reversals, analyzing PA
Here was today's 5 min chart for the Qs.
I tried to scale in for (alternating long, short based on PA) trades based on the PA only to find the price reversing direction in next bar.
I took a LONG setup followed by a SHORT entry and had to exit both the trades with minimal profit, minor loss as it the price was moving quickly and it was hard to rationalize whether I was getting out too quickly (or) if I was cutting my losses short 😀
Both were scratch trades at best as the price quickly reversed direction and I couldn't really establish an ALWAYS-IN direction.
Where can I improve here in terms of my entry & exit? Looking at the bull-bar at 640am (that opened above bull-bar at 635am), one would think a new trend is set at but then it ended up reversing with the 645 bear bar.
Thanks for all feedback !
Of course this is in hindsight, but after your first long, you could have waited before exiting because there were 2 consecutive bull bars with good body and both closing on their highs, so after the bear bar, you could have waited to see another bear bar closing on its low, which we didn't really get, the next 3 bear bars had tails, so bull were buying the lower end of the bars. After that you got another good bull bar, so bulls were comparatively stronger than bears, After that another bear bar, but it did not trigger the sell, then 2 more good bull bars. The only place where a bull should have exited would be below the 3rd last bar in the image.
@shubh Good feedback. Thanks. Interesting why you say 3rd last bar in the image vs 5th bar from the last to exit.
Also after the 2 consecutive bull bars, for the four bear bars that followed, yes there were buys - given the tail wicks - perhaps I could have "scaled-out" given the increasing "selling pressure" and "scale-in" again after I start to see the bull bar developing (after the 4 bear bars with wicks). What would others do in this case. My goal is to take some chips off the table and cut losses in case the selling pressure continues to in crease after the 4 bear bars with tail wicks.
I would have exited on the 3rd last bar (vs the 5th one) because two times before that bar bulls bought the bear bar that closed below the EMA, so I would have seen if they do it again and if we get another bull bar which closes above EMA, the next bar was a bull bar but it looks like it closed on the EMA, I would not have gotten out on it but I think one could say that bulls could not close above EMA so probably they are getting weaker and so to get out. But since this is in hindsight, trading live I probably would have assumed that next bar would be bull again, since next bar was a bear bar closing on its low I would have gotten out there.
I am not yet fluent in scaling in and scaling out, my position size is already the smallest I can trade, so I don't scale out :). The most I do is if I get a second entry in the direction of my trade (usually my first trade is already high probability), or sometimes on the third entry, I enter a second position, and then either scalp it, or exit both together at the target, depending on what the market is doing.