Price Bar Reversals (3 of 9) - The Bullish Rejection Pattern

[nechong]

hi coach,

what if it is the invalid bullish rejection pattern but the price trading above the high?

thanks

[YourTradingCoach]

@nechong

Hi nechong,

I'm not sure I 100% understand the question. Are you asking what happens if the pattern fails? If the pattern fails then you take the loss. Failure of the pattern is an indication that your analysis was wrong. Most likely you've failed to correctly assess market context. Best to get out and reassess.

Cheers,

YourTradingCoach.

[nechong]

@YourTradingCoach

hi, i meant if the current market trend is downtrend and the opening price is on the upper bar side but the closing price is in the middle and is exatly same with the yesterday closing price. so most likely the trend will still go downtrend? thanks

[YourTradingCoach]

@nechong

Hi nechong,

In this case it's not a valid pattern due to closing at the midpoint. Technically, the lower tail should be >= 2/3 the range. So no entry.

That being said, all patterns need to be placed into context. If for example recent price action involves a weak second test of a strong support area, it might still be a great trade long. Whereas in a strong downtrend it should be ignored entirely - look instead for triggers short. Context is far more important than entry trigger.

[nechong]

@YourTradingCoach

today the price break the previous high and up +17 points.

[jbcaldwell63]

Very informative. Looking forward to 4-9!!!

[YourTradingCoach]

Hi jbcaldwell63,

Thanks for the feedback. Video 4 should be posted later today, with the others following up approximately one a week.

Cheers,

Lance.

[YourTradingCoach]

Thanks 1stavros1 & pambid427.

Glad you liked it.

More to follow in coming weeks.

Happy trading,

Lance.

[1stavros1]

great stuff lance

[pambid427]

nice presentation.