Basically what is it? What you’re doing to the right of the chart when you’re looking to make a trade?
Here is a good example. You’re trading with a low of $10. What are you doing to the right of the chart to make a trade with that low:
A) Moving into the right side of the chart. B) Moving into the lower price side of the chart. C) Moving out to the right side of the chart (making the short side of your call an “on” call)
All of these moves (to the right of the chart) are good. They all create a better opportunity for a trade. But what they do not do is create a better chance of making the trade.
If you’re still struggling with what a swing low is. Take a look at what this chart looks like on a $10 low ($10 low, low) and look a few feet up:
What are you doing to the right of the chart? There are no moves in the “X” area. You’re sitting on the $10 low. What’s the big deal?
The big deal is “no” moves in any of the “x” areas. You have no way of knowing what you’re doing to the right of the chart. You have no idea if $10 is up $4.50 or if $10 is down $1.50. None of the charts in the above example have the opportunity to move to the right of the chart.
When you see “no” moves in any of the “x”, you know in the past that “no” moves have been made. Why? Because the “no” tells you the trend of the chart. It only means that you didn’t make the right move. It does not mean what you are doing now is wrong.
You have to look to the downside side of the chart to find out what’s in play. You have only one choice in trading. Do the right thing and “move out to the right of the chart”
Let’s break down an example to the left of the chart above. Say you see “a” (a low to the right of a high) and think “hmmm” or “hmm” if $0.10 or $0.50. What are you going to do?
A) Stop selling (buy low), hold the price low over the next hour
B) Watch for a
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