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Countertrend

BHP - FUNCHARTS: Should we buy the dip?Note: Funcharts are interesting charts I have found that offer a potentially unique perspective on a stock. Sometimes I’ll throw something out there that you might find controversial or wrong headed. If that’s the case your 2 cents worth is most welcome. BHP has sure been belted, but should we catch a falling knife? - Let's take a basic look at BHP using a very short term strategy. It involves using a strategy called Supertrend Strategy with a 3 period ATR input and an ATR length of 1.5 times. - Firstly, I've flipped it upside down, so we get a buy signal when the trend changes to down and a sell signal when the trend changes to UP - Now, next step, Applying this strategy to BHP, take a look at the performance report for Long Trades and Short Trades using the Performance report TAB. Long Trades Buy the Dip , Short Trades Sell the Rally - Looking at Long Trades, 66% of the time it was profitable to Buy a short term dip on BHP and wait for the trend to change back to up, after which you exited the long position. The profit fact was 1.77. No stop was used in the analysis. - It was also marginally profitable to sell short term uptrends in BHP, meaning trend of less than 30 days didn't persist all that often. - What's the verdict? Buying short term weakness in BHP and selling short term strength has made money in the past. BHP is typically a very choppy stock. I hear what you're saying, you'd like to know if buying the current dip we are in will result in a profit? Based on this analysis BHP will usually stage some sort of rally in a downtrend and you would have make money 66% of the time historically. But looking at external analysis I'm not overly confident just yet. When I'd like to get in. Take a look at the blue histogram on the chart, if it goes below -10, I'd expect the odds to be pretty good for a rally of at least a few days, if not more. That means any further (significant) downside could be an opportunity for a countertrend mean reversion play. It'll be a day where there is blood on the streets for BHP.
ASX:BHPLong
by andrew.gibbs777
AMD Bounce play!?Hey all, If you look a little bit left on AMD's chart, you'd see that the mid-70s level is very strong support for AMD. Considering my bullish thesis on NVDA over the next month(though I think it will eventually go lower), I think playing a bounce through July is the right move to make. I just took a long position on AMD at $76/share, but it is very possible it goes a little lower before the said bounce. I WARN you guys though, that I'm only playing a bounce, and this is not an investment; I do think AMD will eventually go lower. I think a conservative estimate is that AMD will see the mid-high 80's again, though it is POSSIBLE AMD sees the high of the range it is trading in in the high 90s. Best of luck in your guys' trading!
NASDAQ:AMD
by MichaelEugen1
2
Possible AMZN short setupHey guys, I've been noticing that AMZN has been repeating the redistribution pattern it made leading up to its rally and subsequent dump in March of this year. Considering the fact that other market-moving names are doing similar things(AAPL, MSFT, NVDA), I am currently anticipating a rally up to the high 130's where I believe AMZN will top out and possibly head to the $80's. Mind you AMZN is still in a macro downtrend following a standard, year+ long Wyckoff distribution pattern and would be significantly overvalued at ~$138/share. In short, if it does rally up to fill the previous gap, there would be little to suggest that it would not reject and head for new lows. P.S. Do take what I am saying with a grain of salt as I believe we're at the end of a market cycle(midst of a crash) and are in the process of redistributing before another leg down.
NASDAQ:AMZNShort
by MichaelEugen1
2
How to analyze a counter-trend trade Do you know if you are a counter-trend trader and if it fits your trading style? We will need to analyze what a counter-trend trader is appropriate to answer these questions. Counter - to move against Trend - the latest direction in which something is moving Trade - to exchange If you put all of these terms together, a counter-trend trade is an exchange that goes against the direction. Let's take into account EURCAD. On the daily timeframe, the price in April was bearish. You can see the visual evidence based on the daily lower lows and lower highs that formed. On May 10, 2022, the buyers pushed the price up past the last lower high at 1.37599, representing the previous highest exchange rate price sellers sold, causing the price to decline again to new lows at 1.33903. This signals a reversal in price. Here is the true question: Would it be wise to become the buyer, and what would that look like? It is wise, but you'd have to understand which market cycle you'd be trading in. There are three market cycles. 1. Trend continuation (a.k.a impulse) 2. Retracement (a.k.a the correction or counter-trend or pullback) 3. Reversal When the price passed 1.37599 to make new highs at 1.37695, that signaled a reversal. It would have been wise to wait for a pullback before buying back up to ensure a better risk to reward. If this trade were taken above 1.33903 back up to the new highs, you would have had a decent risk to reward. But, what about now. Could the same results be produced? Let's go deeper. Does this qualify as a counter-trend trade? If you scale up to the higher timeframe, you will see the weekly timeframe is in a downtrend. It is making lower lows and lower highs. So any buy you enter on the lower timeframe at this point will be categorized as a counter-trend trade. Here is what this means: 1. Do not expect to hold counter-trend trades as long as you would a trend trade. Choosing which timeframes you enter counter-trend trades will help determine where you take profits, and your rules should play a big part in this. 2. Sometimes, you won't know if you're entering a counter-trend trade unless you become aware of which cycle you are trading. If it's not clear, try going up one timeframe. As far as this potential trade here goes, this would be considered a daily timeframe counter-trend trade because the weekly is in a strong downtrend. Something to remember: The best traders go with the trend. They may counter-trend trade occasionally, but their systems work best when they trend trade. When choosing if you are the counter-trend trader, make sure your timeframes align, and you have sufficient visual evidence you are trading with the trend before entering a counter-trend trade. Also, consider lowering your risk so you do not give back profits you may have just earned. Lastly, consider if counter-trend trading may not be your thing. It's ok if it's not. Not all great traders trade the same. It's ok to be in your lane. I pray this quick analysis and note were helpful. I'd love to converse with you if you have any questions or thoughts. So comment below, and let's chat there. -Shaquan
by ShaquanLopez
1
(Episode #556) GBPAUD - Bullish SharkThis is a very different Weekly Market Analysis, seldom do I share a Weekly chart setup but this is special and close to my heart, a Shark Pattern on GBPAUD Weekly Chart. The Bullish Shark Pattern is valid, if you have deep pockets, you can consider this trade, you are looking at more than 1,000pips of potential profit to only Target1. Yes! You read it right, more than 1000pips of profit potential. Personally, I will be watching this trade closely in the lower timeframe for a trading opportunity. This could be my trade of the year.
Long
by RaynLim
USDJPY-Weekly Market Analysis-Jun22,Wk2There is 2 trading opportunity, it depends on which camp you belong to. Counter-Trend Trader or Trend trader. The Counter-Trend Trader could wait for a Double-Top setup within the Supply Zone(red box) with the RSI Divergence setup. Trend Traders can wait for a Buying Opportunity at the Demand Zone(blue box). There is still some time before the US Interest Rate Decision, it is likely to be 1 of the most volatile event that's going to happen on 16Jun, 2 am (GMT+8)
Short
by RaynLim
GBPUSD-Weekly Market Analysis-Jun22,Wk2If you are looking to ride on the wave on the daily chart, either the late entry of the ABCD Pattern or engage the trade based on Potential Head and Shoulders setup, your chance is here. When the market opens wait for candlestick confirmation at 1.2369, the Bullish Deep Gartley Pattern. This is a counter-trend trade move and might inverse the Bearish Shark Pattern setup that you are in. It is important for those who have engaged the shark pattern to shift stop-loss to entry. You can now see that it is important to follow a coach who shares with you analysis before it happens and it is important to like that analysis that you are learning from, and that is because when you've related ideas, you will receive the notification and learn from it.
Long
by RaynLim
GBPUSD - Head and ShouldersIf you had followed my Weekly Market Analysis closely, you would be aware that last week I've said that the market is going to retrace from the high to 1.2475 and for those who had entered the counter-trend trade of the ABCD Pattern at the HOP level , 1.2186 not to panic. What you can do is shift stops to entry and observe if the level at 1.2475 holds on the daily chart. When the market opened, you can wait for the Bullish Deep Gartley Pattern for an entry opportunity to ride on the wave. Check out the link at the bottom.
Long
by RaynLim