We speak here of trends and that which creates and supports them.
What is a trend?
Well, in the market a trend up is a series of higher highs and higher lows, or if it be a trend to the downside, a series of lower lows and lower highs. It is directional movement. It is a reflection of energy expressed in prices, when the prices move in a series of steps to new territory
“Congestion action†is our term for that kind of trading which goes up and down, up and down, between support and resistance, and resistance and support. This pattern occurs again and again, and occurs in a great majority of all market activity. When you see the market bouncing back and forth – that’s congestion action.
We know that the market is almost always in a congestion of one sort or another, and that it is almost never in a pure trend. Or so that is the conventional wisdom. We say that between 80 and 90 percent of the time the market is in congestion.
But we should remember that we must always look at various timeframes. One type of trading in one timeframe does not mean that the same type is operative in another timeframe – not even close.
Lies are sweet, but the truth can be very, very bitter. ”
“Fear is the product of an undisciplined mind.”
“Don’t just sit there and look at the screen. Get up and go spit in the sink three times and say you’ll never trade again.”