Breakouts (BOs)

Question 1

Does a Strong BO or a Weaker BO have deeper PBs?

Answer 1

a Weaker BO has deeper PBs

Question 2

Exhaustion gap bars occur near the beginning or end of a trend?

Answer 2

It is near the end of the Trend 15,20+ Bars in

Question 3

If you see a weak bull BO assume what?

Answer 3

PBs will be DEEP or Possible TR

Question 4

Is a BO a surprise and is it a Low or High Probability event?

Answer 4

Yes INDEED a BO is a Surprise to Traders. And it is a Low Probability event.

Question 5

We have a BO to the upside followed by a downward BO. What can happen next? What can we get on the chart?

Answer 5

Trend Resumption up

Question 6

TRUE OR FALSE
Is every Bar on every chart either a BO, Failed BO (Reversal), or BO PB (Flag)

Answer 6

TRUE

Question 7

In this strong BO are the BULLS or BEARs giving up?

Answer 7

The BULLS are giving up hoping for any kind of a PB so they can get out of their Trapped LONGS and the BEARS that are Trapped out are hoping for any kind of a PB to go SHORT.

*BEARS and BULLS are BUYing SHORT (BULLS buying SHORT out of their LONGS and BEARS BUYING SHORTS to go SHORT)

Question 8

What makes this REVERSAL attempt WEAK?

Answer 8

Prominent Tails

Lack of consecutive BIG BULL BARS (There is a pair of consecutive BULL BARS but they’re small compared to the Big BEAR BARS)

Overlapping of the BARS

Small Bodies (Dojis)

*This is most likely a BULL leg in a TR

OR

A BEAR FLAG

Therefore I should expect at least a small second Leg down

Question 9

This Weak BULL rally has no eager BULLS, why is that?

Answer 9

This Weak BULL Reversal has zero eager BULLS and is a result of BEARS taking partial profits to reduce their risk.

The STOP is far above soo BEARS need smaller position sizes

Question 10

Are the Bulls or bears stronger? is this a breakout or failed breakout or both?

Answer 10

They’re both WEAK

Question 11

When a BO is unclear or is equally as STRONG what is the best thing to do?

Answer 11

WAIT!, Wait for more Bars, wait for more information (context)

Question 12

When the market is in a Tight Trading Range(TTR) what does that mean?

Answer 12

That the market is in BO Mode!!!!

Question 13

A BEAR BO had good follow-through, what does that mean for the bears?

Answer 13

That the market has a high probability of at least one more leg down

Probable Measured Move (MM) down

Question 14

When the market has a STRONG BO like this and then bad follow-through, when does it become neutral?

Answer 14

After about 10 Bars, then at that point, the market is now in BOM.

At that point, there is a 50% chance for a move up and a 50% chance for a move down

Question 15

Does a FAILED BEAR BO mean it is now the Start of a BULL Trend?

Answer 15

No, it does NOT, though it is possible. But for the time being it means that the markets are now neutral

Question 16

When there is a BO above a tight Channel is the first REVERSAL up usually Major or Minor?

Answer 16

The first REVERSAL up is usually Minor.

Minor reversal likely, so probable TR or bear flag, not Bull Trend just yet

Question 17

Is this a Major or Minor Trend Reversal?

Answer 17

Major

DB

2nd Reversal in context with Stronger BULL BOO

4 BULL BARS

2 BIG BULL BARS closing on its high

Question 18

What would you define this highlighted pattern as?

Answer 18

LL DB MTR

leading to a possible major trend reversal of the Trend

Maybe the start of a Major BULL Trend

*This is a strong enough Reversal so that maybe at least a little bit more up is likely, a possible MM

Question 19

What does a Suprise Bar tell a Trader?

Answer 19

A surprise Bar tells a Trader that something has changed, the market has to move too a new price

Question 20

Identify the Surprise Bars on this Chart

Answer 20

1. Give-UP Suprise BAR in a BULL Trend

2nd leg sideways is likely

2. BO BEAR BAR after the BEAR Give-UP Bar DT

HUGE BEAR BAR, MM down likely

3.Exhaustion Bar-BIG BO Trend Bar late in Trend

Probable EXHAUSTION

4. Strong Reversal up from Exhaustion Bars; MM up likely ( Open of 1st Bar to close of the last Bar in BO)

Question 21

Can a Surprise Bar(s) be a PB?

Answer 21

Yes SURPRISE Bar(s) can indeed be a PB in a Trend

Question 22

In these MM BO where is the correct place to put my stops?

Answer 22

My stops will go Above the start of the Strong BEAR BO

and

Just below the start of the Reversal Up BO Trend BAR

Question 23

Where are some entry SELL and BUY position entry locations could I enter the market for these MM BO Trades

Answer 23

Question 24

What is meant by an Exhaustion Climax Trend Bar / Gap?

Answer 24

It is a climatical TREND BAR late in a Trend, it is the potential pause in the Trend or an End to a Trend.

It does not mean a MTR, even though there is potential for that to occur. More context is needed to identify the Reversal

Question 25

The Exhaustion Climax Trend Reversal is confirmed, where would you enter to go long?

Answer 25

Question 26

Once I see this Surprise BULL BO Bar closing above several Bars in the context is the market now in AIL or AIS? and why?

Answer 26

The Market is now in AIL Why? Because it closed way above several Bars in the context and it is probably the start of a BULL Trend

Question 27

Where would you place your stop on this AIL trade?

Answer 27

Question 28

Where would you enter Long on this Surprise BULL BO?

Answer 28

I would look to enter LONG at a 50% PB of the Surprise BO BAR, once the PB occurs and there is a Resumption BULL Signal Bar I would place a stoop to get in at the Close of that BAR

Question 29

There is a Surprise BEAR BO Trend bar that failed, where would you enter long? And why?

Answer 29

The Surprise BEAR BO Trend Bar did indeed Fail as the Follow-Through was extremely weak and non-existent. A lower probability entry for this Long would be at the close of the weak follow-through Bar OR A Buy Stop just above the BEAR Surprise BO Trend Bar

Question 30

Whenever I have a HIGH PROBABILITY trade what kind of Risk / Reward probability does that give me?

Answer 30

Whenever I have a High Probability Trade I am always going to have Bad Risk: Reward

Question 31

With this BO above the TR what is more likely to occur? 3 Legs up or 2 Legs up?

Answer 31

2 Legs Up and a least a MM based on the BO of the TR

Question 32

How would you describe the minimum targets on this chart?

Answer 32

2 Minimum targets based upon the context here is the ... 1. Height of the TR 2. The Height of the BO above the TR

Question 33

Given the big breakout what is a reasonable target?

Answer 33

Between 2624-2620, this is based upon the Surprise BEAR BO Bars open in 1st Bar and the CLOSE of the 2nd BEAR BO Bar

Question 34

Where on this chart did the BEARS give up?

Answer 34

At the end of the MM, there was a Strong BULL Reversal with a DB HL MTR. The BEARs were giving up with very weak price action at the completion of the MM down

Question 35

What are the two possible MM down?

Answer 35

MM down based upon the height of the TR OR MM down based upon the surprise BO Bar Open and the close of the last Bar in the BO (Surprise BO down from TR the PB was a TR than continued down or I could see it as a PB Shallow BEAR FLAG continuation down)

Question 36

How did the BULLS get trapped in the 2nd leg up here on this chart?

Answer 36

Look to the left. We are at the top of the range and failed to close above

Question 37

On this chart, there is a BEAR Trend with a FAIL BEAR Flag were the BULLS managed to take the market above the BEAR flag. However, why did the BULL Rally above the BEAR Flag end?

Answer 37

The BULLS who bought were strong BULLS hoping for just a scalp and were going to be taking profits quickly. The strong BULLs knew it was a 2nd Leg BULL Trap due to the context to the left. At the top of the TR the BULLs saw a very sad Follow through and the BULLS gave up resulting in an end to the Rally and the BEARS are now looking to step in