Hi Mentor
I really appreciate your website. I have been trading a lot of indicators that work inconsistently.
Because of the background i have trading using indicators, i was drawn in by the using the moving averages as a contrarian method.
I have built into it, a demand and supply zone trading. for example when the Moving averages cross, i see where the demand or supply zone formed after that cross. Move down to the lower time frame and take the trade if the market returns to that zone.
I think it makes sense that a demand and supply zone forms, because they are a lot of buy or sell trades when the moving averages cross, which ultimately creates a supply or demand zone.
Is there any truth to my observation? or am i complicating things here.
I cannot wait for your article, on profit taking, because i am taking profits way too quick or too late.
I now wait for the market to form multiple swings in a demand or supply zone, and i use that as my exit, I move my stop when the market makes a new high. and wait either to be stopped out or the market forms multiple swings in the daily demand or supply zone.
Do you find that my method will result in many losing trades?
Kind Regards…
Response:
Hey there…
On your MA method, I see some potential there.
Just placed a 5-day and a 20-day average on my chart to check the zones formed before the crossing… Seems like the market often does return to these zones, so I reckon it might be a viable strategy or at least provide decent confluence.
As for the profit-taking article, it’s in the pipeline…
I’m working on a couple of new books ATM, both focusing on reversals…
Once I wrap those up, I’ll finish the profit-taking article.
Have a great weekend!
PAN.