At this point, I was content to simply let the market settle and see where it
At
this point, I was content to simply let the market settle and see where it
would go next. No real need to consider trades at a point where the market is
moving with quick drops and moves through pivot points and big wicks back up
and all that. Right after this, the pivot acted as a resistance level, as
things were simply cooling down briefly before the downtrend would resume. No
trade was taken at the pivot level, as I wasn’t entirely sure if this would
merely be a resting point before a resumption of this down-move that seemed to
hold some legitimacy or if the market had interest in coming back up above the
pivot. So I waited until the market decided what it wanted to do. It eventually
did fall, went through support, briefly stall and even challenged up against support
as a resistance level like it had just done to the pivot. It wasn’t until the
down-move to support that I was able to find a set-up I was comfortable in taking.
Was located and a challenge of that
level resulted in a nice candle with a strong lower wick. Still, given the
ongoing trend, I wasn’t entirely sure that this would be the point at which the
market would reverse course – at least temporarily such that a winning trade
via a call option would be feasible. It certainly wouldn’t have been surprising
if another red candle went right through. But I was able to get a rejection
of support again on the following candle, so I sincerely considered getting
into the call option set-up.
Once price re-touched yet again on the: 00 candles,
I felt confident enough to take a call option. And this trade also worked out
very well, winning by what I really wanted next was a put option set-up at support
this would have been a very nice type of set-up given the strong prevailing
downtrend. Alas, it didn’t materialize to my liking as I only got the single
touch of the level on the: 0 candle before it began coming back down to .00. I
did debate whether it would be worth it to get back into a call option at
support for the simple reasons that the
downtrend was strong and the more times a level is tested on separate occasions
i.e., goes up and subsequently falls to challenge it again, the less likely it
is to hold.
My thinking behind this – and just through my own personal
experience – is that if a level is getting tested repeatedly, there is definite
selling interest in this particular case, buying in the event of an up-move.
Eventually these sellers are bound to have enough force to break a support
level if they hold the ability to get price there on multiple occasions in the
first place. But like everything in trading, each individual scenario is
different although experiences from previous markets can help guide one’s
opinion. In this instance, price rejected .00 on the: 0 candle and also on the:
The top wick of the: suggested that there was still a relatively decent amount
of force being exerted by the buyers in the market although the sellers were
keeping it near .00. I had the least amount of confidence in this set-up
relative to the others, but I decided Binadroid
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