$VZ - Head & Shoulders Continuation Base Breakout
1. Price trading below the key EMAs, which are sloping downwards.
> This market is in a confirmed uptrend
> Our bias is to look for short opportunities.
2. Head and shoulder base formed since October 2022, against the 50 EMA.
3. Breakout from this pattern near the 10 EMA value area, 2 weeks ago.
4. Wait for a qualified trigger to enter short. This could be a retest of the 10 EMA + break of structure in the lower timeframe or an ostensible rejection candlestick in the current timeframe.
5. Take profit: in the highlighted area, which is the upcoming congested area as draw by a volume profile analysis in the higher timeframe.
6. Stop loss: rough 1 ATR below the 10 EMA
0. No line drawn on an chart will enable you to predict the future. That's not what is being done here. This exercise is about stacking odds on our side. And let me tell what, even the best odds can entail that there is a high likelihood that your next trade is a losing trade. Therefore, more than drawing lines on a chart, abiding by diligent risk management principles is of the essence. Trade small, diversify, do not overexpose your portfolio. Rules of thumb like do not put at risk more than 1% of your equity in any single trade and more than 30% of of your equity at risk at any given moment. Only by staying alive will enable to you to be exposed to luck (yes! you bet your ass it plays an overwhelmingly underestimated role)
and good odds.
Cheers,
Tenacious Tribe - Backtested, Quantified Trading Strategies
> This market is in a confirmed uptrend
> Our bias is to look for short opportunities.
2. Head and shoulder base formed since October 2022, against the 50 EMA.
3. Breakout from this pattern near the 10 EMA value area, 2 weeks ago.
4. Wait for a qualified trigger to enter short. This could be a retest of the 10 EMA + break of structure in the lower timeframe or an ostensible rejection candlestick in the current timeframe.
5. Take profit: in the highlighted area, which is the upcoming congested area as draw by a volume profile analysis in the higher timeframe.
6. Stop loss: rough 1 ATR below the 10 EMA
0. No line drawn on an chart will enable you to predict the future. That's not what is being done here. This exercise is about stacking odds on our side. And let me tell what, even the best odds can entail that there is a high likelihood that your next trade is a losing trade. Therefore, more than drawing lines on a chart, abiding by diligent risk management principles is of the essence. Trade small, diversify, do not overexpose your portfolio. Rules of thumb like do not put at risk more than 1% of your equity in any single trade and more than 30% of of your equity at risk at any given moment. Only by staying alive will enable to you to be exposed to luck (yes! you bet your ass it plays an overwhelmingly underestimated role)
and good odds.
Cheers,
Tenacious Tribe - Backtested, Quantified Trading Strategies
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