Main Points:
- Pay attention to higher/lower lows and highs (swing points) to assess the future direction of price.
- A swing point is defined as: low surrounded by higher lows on each side, or, a high surrounded by lower highs on each side, though I stress you look at the bigger picture and connect these highs and lows with your eyes only, not solely on this objective reference.
- Note the daily macro trend, and find confluence points on where to possibly reenter/ride it out.
- Note the 50% mark on you last major swing; this is a general reference only. Sometimes these fades will occur previous or slightly lower than this level (61.8%, etc), but the most important requirement is confluence points (horizontal support and resistance) found in the middle of your range. Should price follow through or fail, you are typically in a good position to at least lock-in at breakeven in the even of a false follow-through. Additionally, monitor price steepness and the longer term macro trend leading into it.....probably the most important facet of this.
- As usual, macroeconomic/geopolitical events, etc, could wipe out all of this, so pay attention to streaming news sources.
- As a reference, here's the link to the original Quasi Pattern article: http://www.nobrainertrades.com/2009/06/over-and-under-pattern.html
