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Shorteningofthrust

Learning the Ropes: Shortening of Thrust (SOT)Hello, traders! Today we're going to discuss an important technical analysis technique that can help you spot potential trend reversals - the Shortening of Thrust (SOT). This method can be a game changer for new and experienced traders alike. Let's dive in! 🔎 What is Shortening of Thrust (SOT)? Shortening of Thrust (SOT) is a technique used to identify potential reversals in a trend, this technique is a part of Wyckoff and VSA theory. It is based on the observation that the strength of a trend tends to weaken as it approaches a reversal point. This weakening is often evidenced by a shortening of the thrusts, or strong price moves, that characterize the trend. How to Spot SOT To spot SOT shortening of thrust, you can follow these steps: Identify the current trend. This can be done by looking at the overall direction of the price action. For example, if the price is making higher highs and higher lows, then the trend is up. Identify the previous swing high Calculate the thrust of the current move. This is done by subtracting the previous swing high from the current swing high or low. For example, if the current swing high is 100 and the previous swing high is 80, then the thrust of the current move is 20. Compare the thrust of the current move to the thrust of previous moves in the same direction. If the thrust of the current move is shorter than the thrust of previous moves, then this is a sign of SOT shortening of thrust For example, let's say that the price is in an uptrend and you identify the following swing highs and lows: Swing high: 100 Previous swing high: 80 2nd last Previous swing high : 60 The thrust of the current move is 100 - 80 = 20. The thrust of the previous move is 80 - 60 = 20. Since the thrust of the current move is the same as the thrust of the previous move, there is no sign of SOT shortening of thrust. However, if the next swing high is only 110, then the thrust of the current move would be 110 - 100 = 10. This is shorter than the thrust of the previous move, which was 20. This would be a sign of SOT shortening of thrust. distance between the current swing low and previous swing low in a downtrend can be used to measure thrust . To do this, simply subtract the previous swing low from the current swing low. The result is the thrust of the current move. Spotting SOT in Higher Time Frames In an uptrend, if the distance between the high of the previous candle and the high of the current candle decreases, it might signal an upcoming SOT. Conversely, in a downtrend, if the distance between the low of the previous candle and the low of the current candle decreases, we may be witnessing an SOT. To illustrate, consider this example: In this chart, we see an uptrend with each high of the candles getting progressively closer to the next, indicating an up thrust. This signals an SOT and a subsequent reversal of the trend. 📊 Using SOT in Trading SOT can be used to identify entry points for trades against the trend. Traders can use SOT to identify entry points for trades against the trend. For example, a trader might identify a SOT in an Downtrend and enter a long position in anticipation of a reversal. It's crucial to use SOT in conjunction with other technical analysis tools and confirmation signals before making any trading decisions. Here are some additional tips for spotting SOT: Look for SOT in areas where there is other evidence of trend weakness, such as overbought or oversold conditions or divergences between price and momentum indicators. Use SOT in conjunction with other technical analysis tools and confirmation signals before making any trading decisions. Be aware that SOT can sometimes be false signals, so it is important to have a trading plan in place to manage your risk. Conclusion Shortening of Thrust (SOT) is a potent tool in a trader's arsenal, helping to identify potential reversals in a trend. However, remember that it's not a perfect indicator and should be used in conjunction with other technical analysis tools and confirmation signals before making any trading decisions. 🤝 Thank you for your continuous support, likes 🚀, follows, and comments. Your engagement keeps me motivated to consistently provide valuable content.
NSE:KPITTECHEducation
by AfnanTAjuddin
2
Judge the price action momentum - rising wedge pattern and RSIThere are a number of ways to judge the price action momentum. In the previous post, I show you using trend channel as an alternative to up wave or upward thrust to gauge the buying or selling momentum. In this video, I also adopt the same example S&P 500 futures ( CME_MINI:ES1! ) to show you using the popular pattern - rising wedge and RSI indicator to achieve the same objective.  Yet, what I would like to emphasize is to understand the rationale behind the pattern and the indicator, which we can always go back to the first principle to find out, i.e. why a rising wedge is bearish in nature or what bearish divergence in RSI actually means? Once you understand the rationale or the first principle about the price action momentum, you can start trading without memorizing every single pattern or indicator if you prefer.
CME_MINI:ES1!Education
by mingjong
2
S&P 500 futures lose momentumCheck out the video above for a detail walk through of today's analysis of S&P 500 futures. S&P 500 futures ( CME_MINI:ES1! ) started to lose momentum since the uptrend from the bottom formed in 23 Mar 2020, as shown in the chart. It attempted to break above 2880, which is a strong resistance coincides with the overbought line from the channel. The up wave and the upward thrust are getting shorter as shown in the H4 chart. Excessive supply has not been manifested. Despite the red flag of fading momentum, the uptrend is still intact. It is still too early to call for a reversal of the current uptrend. S&P 500 index is expected to travel within the channel since 9 Apr 2020 until is is violated.  A break above the resistance 2880 should S&P 500 heading towards 2980. Bias - up, at a slower pace. Key levels - Resistance: 2880–2900 Support: 2800, 2750 Potential day trading setup - look for a test of the previous day high (or non-RTH high) 2871–2875 to initiate a short entry after a reversal of the trend in the smaller timeframe.
CME_MINI:ES1!Short
by mingjong
2
How to use trend channel to judge the price action momentumIn this video, I use S&P 500 futures CME_MINI:ES1! as an example to show you using trend channel to judge the price action momentum. At the later part of the video, I also show the use of upward thrust, and the up wave on top of the channel to judge the momentum. It is important to assess the price action momentum of any trading instruments (i.e. stocks, Forex, futures, bond, bitcoin, etc…). If there is a fading of momentum, this is the first sign of weakness to pay attention to before we start to anticipate a change of character, e.g. a down-wave to at least stopping the uptrend, if not reversing the trend immediately. Having said that, do not get misled that if we see loss of momentum of the trading instruments, we need to get bearish to short, simply because this is only a red flag for us to anticipate potential weakness ahead. And it will take time to materialize. As long as we have a structure with higher high and higher low, the up trend is still intact.
CME_MINI:ES1!Education
by mingjong
4
Dow Jones - supply absorption to rally up till overbought?Dow Jones futures ( CBOT_MINI:YM1! ) edged up slightly in the London session today as President Donald Trump will issue guidelines for the re-opening economies. 15 Apr 2020 recap - on the daily chart, Dow Jones futures had a reaction with slightly increasing supply, which broke the previous day's low but demand was seen in the afternoon session to push the price up. Similar to S&P 500 futures movement, Dow Jones futures coiled within the bearish rising wedge pattern and broke down an hour before the US session due to bad retails sales data. Despite falling 2% yesterday, excessive supply is not seen and the uptrend from 23 March is still intact.  Since bottom in March, shortening of the thrust is seen in the Dow Jones futures, suggests the buying momentum is fading. However, as I mentioned, until there is evidence of increasing of supply to take the price down, we are likely to see Dow Jones to inch up further, possibly to around 25000 as illustrated. This also coincides with the overbought area of the rising wedge and the resistance zone. Bias - bullish when Dow is above 22500–23000 Key levels - Resistance: 24000, 24800–25000 Support - 23000, 22500 Potential day trading setup for Dow Jones futures - look for a spring of 23000 or swing lows in H1(23200)to initiate a long entry. Enjoy this video? Like the idea and hover my picture to follow me and subscribe my channel to get instant notification for my next ideas.
CBOT_MINI:YM1!Long
by mingjong
S&P 500 futures shortening of the thrust with a rising wedge14 Apr 2020 recap - on daily chart, S&P 500 futures managed to overcome the psychological level at 2800 and close at 2843, which is a bullish sign. Yet, shortening of the upward thrust is spotted, especially in H4 timeframe, since the low from 4 Apr 2020. A rising wedge pattern is formed and is near the end, suggests the time has come to pick a direction to either break down the wedge to retrace to 2700–2730, or to rise to the overbought area before starting any reaction. Although the rising wedge pattern is bearish in general, it is better for us to assess both scenarios so that we are well-prepared to trade in either scenario. So far, supply is not manifested. It is important to judge the character of any reaction together with the volume to gauge the direction ahead. Bias - neutral, waiting for ES to resolve from the rising wedge pattern. Key levels - Resistance: 2850, 2900 Support: 2800, 2700–2730 Potential day trading setup - look for a test of the support at 2800 to initiate a long entry. Should it break down 2800, look for weak rally up for a short entry.
CME_MINI:ES1!
by mingjong
2