Hello. As a beginner, I wanted to ask for some advice from more experienced traders when you have chart factors that clash. In the attached EUR/USD, there are many nearby shortie stops above price, but the indicator below is showing that longs are in profit. I know this just may be a nuanced situation with an uncertain outcome, but wanted to ask for any thoughts when you have conflicting factors like this? Thanks very much for any help.
Ask yourself, what is the path of maximum pain? – All those low hanging Short SL’s,just dangling above the market?
Then ask your self where DM bias is? – Shorts are still heavily dominant.
Then ask yourself how the most recent DM is positioned? – There are actually slightly more DM longs than shorts.
So there is some degree of ambiguity there. i.e. a ‘lower confidence’ long.
So you return to your analysis chart and see what looks appealing (or not) based on your conventional TA).
P.S. Full disclosure….I am new to MK, but not new to the markets, so I grasp this stuff very quickly.
Thank you. You confirmed my slight bias. As Djamal has said, time and range principal. In other words, the stops can wait, but they prob don’t like DM in profit very much. So, it did what I had guessed which is touch some stops and then punish the longs in profit. My guess is that it will vacillate back and forth between these two areas. Thanks again for your thoughts. Helped clarify some of mine. I appreciate it.
Check this….Red Opaque Crosshair marks the spot where as things currently stand in EURUSD, the market won’t have any motivation to go much lower than, before cranking back up to get some more Short SL.
That’s the theory anyhow.
Here it is zoomed in.
The market will have motivation to rinse the Longs building up beneath price, but will likely balk at the clutch of Short Position Bars, and not want to give these guys a chance to exit with their shirts on their backs……with no major econ release on the horizon, likely that EURUSD goes down to get the Near Term Longs. Stops prior to the Short PBs, then works it’s way back up to harvest the NT Short SL cloud up above.
As it turned out, the market didn’t have the motivation to take out the longs, and just went for the main meal up above:
Thanks. Great visual. Just wondering how much the MM’ers will allow the longs to profit though? It’s yellow below for longs so interesting dynamic
As the Admin mentioned previously, please try to keep pics of or detailed conversations of MK in the Commercial Section, thanks.
DM could be in profit for quite some days, especially when one side has very low volume in the market. Look at the 4H charts to see better zoomed out examples of duration and reversals.
Sorry for that oversight. Will keep in commercial going forward and thanks for the guidance on the 4HR.