Category:SPBLT

Small pullback bull trend. Most pullbacks are small and only last 1 or 2 bars. Probably buyers below prior bar.

Characters of SPBLT[编辑 | 编辑源代码]

• Tends to have at least a couple of BOs (i.e. gaps or body gaps) early in the day
  • That said, a SPBLT doesn't have to start from the open, even sometime the open can look like a SPBLT starting. Sometime it needs enough test to EMA or other important support before it starts. For e.g. 20220317, after enough test to EMA, the SPBLT started somewhere around 22, note that one of the most important sign is that bulls buying aggressively at every bear attempt, like 19, 21, 29 etc. Other examples: 20221107, 20221111.
• Always form wedge tops but most quickly become bull flags
• Never look quite as strong as traders want
  • It is essential to realize that in a small pullback bull trend, the move is never quite as strong as traders want, so it causes traders to look to enter on pullbacks. So, while the market can appear weak, it is a tight channel which is a breakout on a higher time frame. 20220317
• Bears should not be able to make 1R easily
  • If expecting a SPBLT, bears should not be able to make 1R easily, if they were able to do so, it decreases the probability of SPBLT, e.g. 20220317 13 bears able to make 1R easily, but after the SPBLT started from around 22 to around 54, bears not able to make 1R.
• Usually does not pullback to EMA before around 2pm EST if the trend is to last all day
  • If the trend is going to last all day, it usually does not pullback to EMA before around bar 54 (around 2pm EST). If it does, that usually means the trend is converting to TR.

How to trade[编辑 | 编辑源代码]

Buy[编辑 | 编辑源代码]

• When a trader confirms the market is in a small pullback bull trend, it is important to find a reason to get long, such as a pullback to the moving average, and look to enter at least a small position, just in case the market rallies far. 20220317
• When there are many big bull bars without much pausing or overlap in the SPBLT, there is increased risk of exhaustion and then TTR (and then trend resumption more likely). (example 20210409 WBLFLG then SPBLT then LBLBO 49-65).
• when strong bear bar appears in wedge top in SPBLT, probably more buyers than sellers below bear bars, higher probability to wait to sell until consecutive strong bear bars or strong bear BO. Ex 20210409 WBLFLG then SPBLT then LBLBO.
• If it is SPBLT, can use tighter stop (better to exit 1-2 points below, not just 1 tick below, if exited, buy again above BLBCH), because if it is to become small pullback bull trend, the pullback will be small.

Sell[编辑 | 编辑源代码]

• Only look to sell until transition into TR or has MBRS after BX