Didn't see any good setups this morning.
I decided to sleep in.
I haven't been getting enough sleep lately, so decided to close my laptop and sleep the day away. Woke up around 4pm with a question on my mind: Am I overlooking any details? What did the volume candle on $GLBS look like at dip support? I don't know why this particular detail stuck out in my mind, but I was severely interested.
You see, $GLBS had a great dip this morning and I'd had all the details dialed in. It was my main watcher and my finger was on the trigger. But I couldn't make the trade. Something just didn't feel right. The slow, gradual bounce was too lackluster. I'd cleared my order draft and felt good about trusting my rules. After all, the past week has been FAR too shakey for morning dips; especially with the Healthcare sector all over the place.
Opening my laptop and looking again, turns out $GLBS had a BIG green volume candle that signaled "TRUE" support. This got me thinking. I began to do some research over my wins vs. losses and EVERY SINGLE WIN signaled a solid entry point with a big beautiful green volume candle. My losses showed half-sized or small green candles as my "TRUSTED" support where I'd entered each trade. Trusted vs. True.
I decided to look further.
Perhaps into more recent high-profile tickers and their price action over the past couple weeks..
$SHMP.. $BPTH.. $TROV... With almost 100% accuracy, EVERY SINGLE SUCCESSFUL BOUNCE had what I would refer to as a "BIGGER Green Candle" at the point of dip reversal. Kind of uncanny, because it's not the size of the 1-minute price-action candle (which I'd previously been concerned with) that's in question here: it's the VOLUME SUPPORT for said candle. I'd also found that even when a bigger green volume candle didn't promote a higher price-action change above, the ticker at the very least tended to go sideways; giving the trader more than enough time to calculate the remaining factors which could help them decide whether or not it would be time to exit the trade.
Let's be clear: In my view, a bigger green candle means a green volume candle that is bigger than most if not all red candles immediately before it. To me, that (along with Level 2) signals definite trend reversal and a likely safe entry point for the dip buy.
Now, will I miss some dip buy opportunities using this "BGC" (Bigger Green Candle) method? Definitely. For example, $CIFS signaled a small green volume candle for it's partially successful morning dip buy on 03/01 @ 9:37AM (4.38). Though, it should be pointed out that this particular bounce failed at near resistance above (4.53), with only the initial one-minute green price-action candle to show for it before reversing downward. This small green volume candle promoted more of a dip pop than a true bounce. While you could have held for the retrace, which eventually topped at 4.69 (using 4.37 as support), I've been taking a "no trust" approach for growing my two small accounts. My aim is sniper singles with absolutely no holding past the first move... I've found that the second move is never as potent as the first and (at least for dip buys, in my experience) the first bounce is where ideal profits for small accounts are made. It dips, it bounces, it struggles, I'm out... and it's been working very well.
What's interesting is, I've previously been taught to and have taken mental notes on using big green volume candles as support; especially for dip buys. I've watched 501 video lessons in the past two months, 215 specifically on dip buys. Why have I forgotten to consider BGCs in real-time? Mike Tyson said that, "everyone has a plan until they get punched in the face". Whether you are unprepared, inexperienced or overwhelmed, it's very likely that you'll miss the forest through the trees. When the bell goes off, there are two fighters in the ring: the market and the trader. One is calm, collected and in control. The other, at least 90% of the time is likely frantic and confused. One is dancing with every detail, the other is fumbling around with uncertainty. It's up to you which one you'll be.
A mansion is nothing if built on sand and neither is price-action. So going forward, at least for now, I will not only care if the chart shows green price-action above; my top priority will be on considering how much SUPPORT is building under said price-action. If I would have considered this rule earlier, I would have had the final puzzle piece of certainty to feel good submitting my order for a solid gain. There is always more to learn and perhaps tomorrow will tell a different story. For now, it's back to video lessons. Stay focused Brandon =)