I was trading the Dow Jones and I saw a typical operation that i thought i should share with the public. Although it doesn't happen every night and since it just happened, it was fresh off my mind that i could draft out the operation with pictures and wordings illustrated. Understanding these operations had definitely helped me in my trading and liberate me from trend lines and other technical indicators.
A friend of mine asked me, oh, that looked like double bottom, so it's a long. In my previous post, i already mentioned that i don't look at chart patterns because that's not the approach how insiders look at charts. Instead understanding supply/demand and psychology is more concise and precise which allows for more flexibility in your trading rather than a fixed pattern which etched in your mind that produce rigidness which doesn't allow you to react fast when the market turns. Finally, trust me, when all these actions are happening in real time, there is no way that you can determine that it is a double top or double bottom. End of Day and Live trading is two different ball game.
Ronald K
