by eric-pal » Sat Dec 03, 2022 2:56 am
The purpose of counting is to measure attempts of reversing the primary direction. If the primary direction is downwards, then the next bar moving even farther downward, whether a bull or a bear bar is not relevant as it isn't a correction.
In a downtrend then, as prices move upward, the bar that moves below the previous bar in the upwards retracement is a count of 1. The 2nd movement lower, in the shorter term upwards retracement, in the longer term downtrend, is a 2ES (second entry short).
If in an upwards retracement the bar is a bear bar, but it doesn't move lower than previous bull bar, it is known as a "hidden" count. Initially, I would recommend not consuming yourself with this definition and stick with true counts until you have gathered more experience. This portion will then be obvious, whether one takes those counts or not.
Review the red counts for counts to go short (counting upwards from a lower low), and green counts for long potentials (counting downwards from a higher high) and hopefully it makes a little more sense.
Note, counting isn't an edge in and of itself. It is simply part of the measurement game.
Hopefully helpful and good trades to you!
The purpose of counting is to measure attempts of reversing the primary direction. If the primary direction is downwards, then the next bar moving even farther downward, whether a bull or a bear bar is not relevant as it isn't a correction.
In a downtrend then, as prices move upward, the bar that moves below the previous bar in the upwards retracement is a count of 1. The 2nd movement lower, in the shorter term upwards retracement, in the longer term downtrend, is a 2ES (second entry short).
If in an upwards retracement the bar is a bear bar, but it doesn't move lower than previous bull bar, it is known as a "hidden" count. Initially, I would recommend not consuming yourself with this definition and stick with true counts until you have gathered more experience. This portion will then be obvious, whether one takes those counts or not.
Review the red counts for counts to go short (counting upwards from a lower low), and green counts for long potentials (counting downwards from a higher high) and hopefully it makes a little more sense.
Note, counting isn't an edge in and of itself. It is simply part of the measurement game.
Hopefully helpful and good trades to you!
