Zen Trading Tech

Intro

• Once do this drill you will see them everywhere
• It will give you more confidence in reading price action if you practice it

Video

• See more details here:

1. Intro
2. Video
3. Leg Counting: 3 Ways
4. Instructions for Drill:
5. Various
6. Other Notes on Wedges
7. Conclusion

Leg Counting: 3 Ways

• Pullback goes below low of prior bar in bull leg
• Pause – sideways / inside bar / opposite bar (Lower timeframe had a pullback)
• Implied – tails (Lower timeframe had a pullback)

Instructions for Drill:

• I used the 5min chart as my tradable timeframe. If yours is different then you can adjust from there.
• Go up a timeframe by a factor of 3x (For me 15m)
• Draw arrows – Snap to highs and lows of the spike – use the obvious one if unsure

• Go down a timeframe by a factor of 2-3x (2m)
• Connect 3 push patterns – ok for overshoot and undershoot

• Go back to the 5min chart

• Now mark reversal signals with small arrows

• Notice where they fail for the secondary trade!

• Notice the different between trend vs counter-trend wedges
• Counter trend wedges will help your profitability a lot!

Various

Other Notes on Wedges

• Reversal setup
• 2 legs similar
  • Slice one leg – Overshoot / undershoot
• Wedge is often 2nd part of a DT / DB
• Wedge can fail!
• Wedge with trend and counter trend
• Whole wedge can be one leg in a bigger wedge

Conclusion

• Practice this one until it becomes natural!