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A chart formation is a recognizable pattern that occurs on a financial chart. Optimization of a set of 31 items based on expert reviews of the initial pool of items (the authors evalu- The logic in this indicator dynamically finds each level in a PMG and draws a line for easy identification. A broadening formation is a price chart pattern identified by technical analysts. Over the last few weeks, I have been practicing The Strat, and I found my way to Jim Bradley. Downward breakouts have a big break even failure rate which may disqualify them from your trading tools. Shooting Star == gold (Bullish) How the pattern performed in the past provides insights when the pattern appears again. Major conclusion of the trading method is based on time frame continuity. I set a first target of a quick 0.10 and then let the second call run with three different exit tactics in place. This tells you that buyers are present. The pattern usually forms at the end of a downtrend but can also occur as a consolidation in an uptrend. In addition, VIP members get access to over 50 VIP-only custom indicators, add-ons, and strategies, private VIP-only forums, private Discord channel to discuss trades and strategies in real-time, customer support, trade alerts, and much more. Results (note I made another smaller trade resulting in a $2 gain, nothing noteworthy though): I am only bringing this up because someone else that read my posts brought it up to me. Jun 11, 2021 Comment: BLAST OFF Twitter I should be very clear. And here you get a classic actionable signal, a 3-2d-1-2u. Strat Setups Bullish PMG. Directional Bars - Directional Bars occur when the current candle takes out one side of the prior candle. He operates a trading room at Sepia Group. BROADENING FORMATIONS (1ST DRAFT) This study will only find 1-3 combos and extend diagonal lines outward. Differences between a Symmetrical Triangles and Pennant Patterns. Learn all about VIP membership, To access the premium indicators, which are plug and play ready, sign up for VIP membership. The pattern is considered a continuation pattern, with the breakout from the pattern typically occurring in the direction of the overall trend. By clicking Accept All Cookies, you agree to the storing of cookies on your device to enhance site navigation, analyze site usage, and assist in our marketing efforts. Amanda Jackson has expertise in personal finance, investing, and social services. To view the purposes they believe they have legitimate interest for, or to object to this data processing use the vendor list link below. A broadening formation is a technical chart pattern depicting a widening channel of high and low levels of support and resistance. Buyers become increasingly willing to buy at higher prices, while sellers find ever more motivation to take profits. If you need professional investment advice, please consult a registered investment adviser. We believe that every student is a pre-scientist, and we aim to give them the tools they need to continue their education. Additionally, on Benzinga Pro, you can easily have all your charts set up as recommended by Jermaine. Sofien Kaabar, CFA. The Strat eliminates guessing, bias, market noise, and focuses on aspects that we can define, quantify, analyze and execute on. It is identified on a chart by a series of higher pivot highs and lower pivot lows. Rob Smith's theory is that stock prices move through a series of broadening formations. Missed the smaller scale one which perfectly tagged the recent low but i've done some more studying and almost completed the strat course, so my eye is sharpening every day. She is a library professional, transcriptionist, editor, and fact-checker. For example, the S&P 500 has consistently moved higher over the long term; therefore, the formations are more common at times when market participants have begun to process a series of unsettling news topics. This helps traders to determine continuity, correction or start of the reversal. Broadening is a type of semantic change by which the meaning of a word becomes broader or more inclusive than its earlier meaning. This was the tsla chart about half an hour after the open. What Is a Broadening Formation? EURUSD with the Strat indicator. I had a solid start, and I have decided to share my trading here. Hammer == silver (Bearish) All things strat related for stock trading, a methodology created by Rob Smith. Broadening formation / Expanding triangle. Inconsistencies regarding the effect of multicultural and transient experiences on well-being exist in the psychological literature. It may not display this or other websites correctly. You can login with twitter below to verify your age. You also have the option to opt-out of these cookies. Jermaine says that the three things known to be true while trading on The Strat are actionable signals, time frame continuity, and broadening formations. With small accounts, you dont hold losers. Talc Lawsuits Keeping Lid on Johnson & Johnson (JNJ), Trend Trading: Definition and How Strategy Aims For Profit, Trend: Definition, Types, Examples, and Uses in Trading, Descending Triangle: What It Is, What It Indicates, Examples, Understanding Trend Analysis and Trend Trading Strategies, The Ascending Triangle Pattern: What It Is, How To Trade It. These formations are relatively rare during normal market conditions over the long term,since most markets tend to trend in one direction or another over time. My friend Trish in Woodstock IL has 3 puppies for sale! Directional bar which are known as type 2 bar Outside bar which is known as type 3 bar Knowledge should be collaborative and shared, not behind a paid wall. Technical analysis experts usually use candlestick charts to view stocks. Resolved: Release in which this issue/RFE has been resolved. Trading using The Strat with smaller accounts may be more beneficial on larger time frames, due to the PDT rule constraints. You and only you are responsible for the decisions you make trading. call or text 1-312-613-0973 Oh wait! Within this disk, smaller clumps of gas and dust began to form, eventually becoming . Bull Flag. Today was a big day. Rob Smith is a trading mentor and the Director of Research and Trading Operations for Smith's In The Black LLC at www.SepiaGroup.com. Simple fix is to remove your "=" references in the code. Gordon Scott has been an active investor and technical analyst or 20+ years. Usually in the afternoon I'll scan my list of stocks for daily, weekly 1s, 3s, and 3.1s (Rob calls a 312 a "Chicago" bc that's the area code there) and add them to a watchlist. I had a solid start, and I have decided to share my trading here. Some of our partners may process your data as a part of their legitimate business interest without asking for consent. He's been engaged in the markets since the young age of 15. Investopedia does not provide tax, investment, or financial services and advice. I usually try to limit myself to that one perfect trade, but TSLA was moving so nicely that I could not resist :). The decision to buy or sell must be predicated upon a deeper understanding of The STRAT and any other tools at your disposal. We do not recommend the use of news as a sole means of trading decisions. And 3s go outside both sides of the previous candle. Introduction In order to resolve thin beds in seismic data, the frequency bandwidth should be broadened [1]. For example, many countries experience broadening formations due to heightened political risk ahead of an upcoming election. I believe this code is incorrect: Join 2,500+ subscribers inside the useThinkScript VIP Membership Club, VIP members get exclusive access to these proven and tested premium indicators: Buy the Dip, Advanced Market Moves 2.0, Take Profit, and Volatility Trading Range. Hammer that counters/turns into a shooter, Whole day is inside candle from prior day, Whole week is inside candle from prior week, How far a price run is or the price target, Company or an individual that quotes both a buy and a sell price hoping to make a profit on the bidask spread, Rob Smith saying look for the GAP on these it might fill, when a price breaks above or below the previous candle high or low from the open used on 15, 30, or 60 mins from open, the high price of a stock from the opening range 15/40/60 mins from open breaking to the upside, the low price of a stock from the opening range 15/30/60 mins from open breaking to the downside, Traders who trade 4+ day trades over the span of 5 business days on a margin account get their account flagged with this, Stock trading before the market opens 9:30AM EST, Trend pivots the other way taking out several highs or lows of other candles, Candle that looks like a gun or upside down T, moving average calculated by adding recent prices and then dividing that figure by the number of time periods, Flip of the time interval to produce a new candle, corrective pullback/activity - a wedge or triangle shape of the recent candles, statistic used by traders to determine what the average price is based on both price and volume, Above the reversal / continuation entry to the upside and below the reversal / continuation entry to the downside, Gamble play, risky but very rewarding, usually a fast expiry, 1 - Top wick / high / very top of the candle, The highest price the stock trading during the given time frame of the candlestick, 2 - Bottom wick / low / very bottom of the candle, The lowest price the stock trading during the given time frame of the candlestick, The price of the stock at the open of the given time frame (top or bottom of the fill depending on the color, more below), The price of the stock at the close of the given time frame (top or bottom of the fill depending on the color, more below), 3/4 The open was lower than the close, it opened at the bottom and closed at the top (price went up), 3/4 The open was higher than the close, it opened at the bottom and closed at the top (price went down), 1 Candle / Inside Bar / Inside Action / Consolidation / Sideways, Occur when the current candle falls completely within the prior candle, Balance, equilibrium, buyers and sellers agree on price, no one is in control, trying to determine where price is going next, Never trade a one bar, wait for the consolidation to stop then it's time to get into a trade, 2 Candle / Directional Bar / 2 Down / 2 Up, Occur when the current candle takes out one side of the prior candle, A 2 down means it took out the previous candle's low, but failed to take out the high, A 2 up means it took out the previous candle's high, but failed to take out the low, Sellers are selling it down or buyers are buying it up but not both, a 2 can turn into a 3, but never a 1, The market trades in the direction of the most 2's, but only trade 2's with continuation, 3 Candle / Outside Bar / Discovery Candle / Mother Bar, Occur when the current candle takes out both sides of the prior candle, Price discovery starting over, buyers willing to buy it up, sellers willing to buy it down, choppiness, Never trade a mother bar, price discovery is happening, wait for further confirmation one way or anther, Price direction is best determined when looking at multiple time frames rather than lagging indicators or moving averages, When all time frames point in the same direction in either direction, or Full Time Frame Continuity, is the ideal trading situation, Simplest explanation is = it's a compound 3 bar, Just pick a high, draw the line to a higher high, Bars should be more FLAT than not, otherwise mostly inside action (which is fine, but if you are looking for trends start flatter), Increasing price volatility and diagrammed as two diverging trend lines, one rising and one falling, It usually occurs after a significant rise, or fall, in pricing action. The monthly and weekly inside candles were negatives to me, but I loved the daily chart. Some of the main actionable signals Jermaine points out are: Actionable signals are important because they tell us why the price is moving. Check out these articles: // Purpose: Displays: (1) The Strat candle numbers, (2) The Strat Combo labels and trigger line, // (3) Pivot Machine Gun (PMG) dynamic labels (4) Hammer and Shooter candle labels, // Setup = the first two bars of a three bar combo before the third bar has formed (before timeframe of third bar), // Potential = the first two bars of a three bar combo and the third bar is a one (during timeframe of third bar), // Inverted Hammer == silver "" (Bearish), ///////////////////////////////////////////////////////////////////////////////// INPUTS, // i_length = input.int(defval=20, title="Length Days", minval=1, maxval=20, group=GP1), // i_mov_avg_function = input.string(defval="SMA", title="Moving Average Function", options=["RMA", "SMA", "EMA", "WMA"], group=GP1), ///////////////////////////////////////////////////////////////////////////////// FUNCTIONS, ///////////////////////////////////////////////////////////////////////////////// Average True Range, // Use different moving average functions to calculate ATR, ///////////////////////////////////////////////////////////////////////////////// TheStrat's 1's, 2's, & 3's, // https://kodify.net/tradingview/bar-data/close-higher-lower/, // https://www.pinecoders.com/faq_and_code/, // https://www.tradingview.com/pine-script-docs/en/v4/annotations/Plotting_shapes_chars_and_arrows.html, ///////////////////////////////////////////////////////////////////////////////// Strat Combos, // three-red; two-down-green; two-up-green, // ones[2]; two-down[1]; low[1] < low[3] (broadening formation); two-up-green, // ones[2]; two-up[1]; high[1] > high[3] (broadening formation); two-down-red, ///////////////////////////////////////////////////////////////////////////////// The Strat Combo Box Labels, // Don't show 22 BLR inside Rev Strat Bullish, // Don't show 22 BRR inside Rev Strat Bearish, // double_inside_bars = (low[2] < low[1] and high[2] > high[1]) and ones[1] and ones, // Only plot shape when double inside bars have stopped occurring (This prevents unncessary plot shapes), // When a double inside bar occurs, always draw trigger lines, // pivot machine guyn is 5 or more consecutive higher lows or lower highs on any time frame, // Loop over last 12 bars and check if conidtions meet PMG criteria, // If a PMG has occurred, start tracking the start bar number, // Delete previous PMG box (if there was one), // Draw horizontal lines on high from beginning of PMG bar, // Draw horizontal lines on lows from beginning of PMG bar, ///////////////////////////////////////////////////////////////////////////////// HAMMERS & SHOOTERS, // https://commodity.com/technical-analysis/hammer/, // https://commodity.com/technical-analysis/inverted-hammer/, // https://tradingsim.com/blog/shooting-star/, // https://commodity.com/technical-analysis/shooting-star/, // https://commodity.com/technical-analysis/hanging-man/. Hanging Man == gold (Bullish). The studies are looking great! Australian Shepherd Border Collie mix! The price may reflect the random disagreement between investors, or it may reflect a more fundamental factor. Directional bars and outside bars that fit into a triangle and ultimately lead to reversals or expansions and present trading opportunities, Little to no top wick, open and close are very close to the top of the wick, 75% of the candle is mostly wick at the bottom, Entry as soon as the next candle breaks above the top, or top, wick of the previous hammer candle, Candle that looks like a "shooter" / upside down hammer, Little to no bottom wick, open and close are very close to the bottom of the wick, 75% of the candle is mostly wick at the top, Entry as soon as the next candle breaks below the bottom, or bottom wick, of the previous shooter candle, After price is done consolidating it will break up or down, take the break at the top or the bottom of the previous inside candle depending on which way it goes, A very fast moving upwards or downwards candles taking out previous highs or previous lows, As the prior candles are "taken out" it causes those investors to go the other way, reinforcing the direction of the bar even more taking out even more highs or lows, As consolidation is happening, things will get "tighter" toward a point and eventually break out up or down and go fast, My personal script for free - actionable signals, colors, strategies, work in progress.