FRIDAY was one of those days that BOTs really shine and work extremely well. So let's cover what IT is all about.
Each day, the markets will trade a given range. There will be two points in that range that will define bull strength or bear strength. This is a market value where one side has an advantage over the other and the dominate position will be with trend, the lessor will be counter trend.
These points are the break out or the start of the dominance. Thus, break out targets (BOTs) were developed to capture the market dynamics.
When a BOT breaks, the position is with the trend. The CT's are for scalpers or used for the with trend exits. The money is with the market. The CT's are playable but not optimal for long term trading. They will work enough to get you in trouble with higher probability losers. The money is in higher probability winners.
Extended break outs will run to a +5 (BO5) +10 (BO10) or more. These suggest that a trader should hold until price action PA returns to the prior BO level or the EMA. This eliminates the need to monitor every bar. You are looking at the market; playing what the market makers are allowing.
We had a range run (one bot to the other) in the pre open that hit the Long BOT (LB) and began selling for another range run. Once the EMA falls below the short BOT (SB) the market was decisively bearish. Holding until the EMA hit was nearly the max playable for the day.
Duh. Looking at the chart TODAY anyone can see that the market was a short, and you would be correct. But BOTs were showing the bias BEFORE the market opened.
BOTs, then the market PA.
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