LEARNING THE ROPES - another descending triangle

Been reading Technical Analysis and Stock Market Profits - Richard Schabacker

2nd Margin Trade while applying the concepts! (Tho bending some lol)

SHORTING because:
- Overall Downtrend
- RSI is about to meet resistance
- Forming a descending triangle (Book's strategy is to enter on breakout with significant volume. I'm jumping the gun with a stop loss at 7120. - Minimize draw down and get a better R/R since next supports are at 6200 and 5800)
---> Volume diminishing
---> Price in a decline
- Testing strong resistance at 7000. Strong rejection at 7200. Unable to form higher low after the breakout of a falling wedge at 15min (Sign of strong selling pressure)

SPECIFICS:
- Entry at 6950
- Stop loss at 7120
- Target 1 - 6200
- Target 2 - 5800

Kommentera:

Fucc. That was intense. Going down now. (This is stressful. Entry on breakout is the more conservative + less stressful + safer play)

- Bearish divergence on RSI and rejected at the RSI trend line on 1HR.

Kommentera:

Downside to trading in the range aka jumping the gun:
- Other patterns might form, you have to guard it if ever the pattern goes against your trade.
e.g. The pattern I saw was descending triangle, but it's developing into a Head and Shoulders. Lucky for me, I'm still at short. Position is at 50% as of the moment. Will add 50% at the break of the neck.

LESSON: ALWAYS WAIT FOR THE PATTERN TO DEVELOP. THEN TRADE ON ITS BREAKOUT. REAAAALLY IMPORTANT.

- Moved my stop to 7300 before I got stopped out.