dbandas

The bar after Bar 1 is the H1, so the bar after Bar 2 is the H2. One is really looking for two-legged pullbacks. Often, the 2nd pullback is "deeper" as the market battles. The H2 can be at a higher price or a lower price than the H1. Figuring out when to start counting over is an art, but has to do with seeing the bigger picture of two-legged pullbacks. This throws me when he discusses H3s and H4s. Reading the book from the first page to the last is daunting. I watched the videos several times, read the smaller articles to acclamate to the "lingo," and I found that indispensable. I also personally believe that Chapter Four is the place to start. Good luck!

Thanks very much! David

Is there anything that comes to mind, other than Forex, that can be traded in the evening in the US Central time zone? The S&P is too thin, until about 2am. Thanks!

I conclude the opposite: why would a successful trader allow themselves to be distracted? I take it at face value and appreciate what Al offered there. Definitely a tricky book, but by the time it gets a better edit, I'll be rich beyond caring..........

The glossary refers to these as reversal patterns, particularly after an over-extended market, and the first chapter basically says that they often develop during flags, and to be alert to trading them either way. How's this different from any other flag? Seems to be an implication that flags with ii or iii formations may fail more often. Am I missing something?

An L2 entry would be the result of a low that is lower than the deepest bar in the pullback and not higher than the high. That would be H1, H2 territory. Here, the bullish bar at 8:30 should really have a low that is higher than the low of the previous bar, but it is an "implied" pullback.

Busted! I agree completely, and Al states that clearly in the trend chapter, that the 3-minute is useful in runaway markets to discover pauses or pullback opportunities. I've just missed some first hour moves due to inexperience/reticence lately, and read this in Chapter 11: "Although the 5-minute chart is the easiest to read and the most reliable, the 3-minute chart trades well, particularly in the first hour. However, it is prone to more losers, and if you like the highest winning percentage and don't want the negative emotion that comes from losing, you should stick to trading the 5-minute chart and work on increasing your position size." Al is so right-on about the opportunities in the first hour or so, and I've not been able to always hop on the train.

I was a little confused because you are on the Globex chart, and I was looking at the day chart. At any rate, your numbering looks fine to me, but I think your entry may be a little confused. If the bull bar at 8:30 is the signal pullback bar that creates your L2, the entry would be at one tick below it, or 1009.25, not at one tick below the next bar, which is your entry bar. I was getting confused switching between Globex and the day session chart, so I just abandoned Globex except to see where the gap may be. Al suggests imagining the gap as a trend bar, and I actually use my drawing tool to draw one in. He also takes about the charting dilemma somewhere, maybe his website.

I agree with the short after the 4th bar, since it is a "twin" or double bottom, and an L1-type pause in a fast-moving bear. The 3-minute chart corroborates this. I would never have placed a trade after the first bar on the 5-minute. On the 3-minute, there was a little pause made by the 3rd bull candle, but it's not a bad signal bar for a bullish gap play or H1. Actually, these initial moves often cause me confusion, and in the case of this 3rd bullish bar on the 3-minute, an entry on either side could be argued, IMHO. And, all of the previous ramblings prove you don't have to be a successful trader to talk or write about it, especially after the fact!!!! :haha: Just trying to claw my way out of the middle class........

Yes, I hate to see that. But, it was helpful while it lasted. Especially the link to the charts in the books. I would really love to see him post at the end of the day and do a post-mortem. Even a few days a week.... Or some new articles occasionally. I can't memorize everything he says, but every time I work through a chart I flex my own interpretation muscles a bit and learn to think more clearly.

I'm working my way through the book, and it is incredibly worthwhile to me. Previously, for daytrading, I had subscribed to the expensive indicator philosophy which definitely works for some. It didn't for me. I was frustrated because I wasn't learning anything. Anyway, some suggestions. I listened several times to the two Al Brooks audio/video presentations made through Futures Magazine. Also, I read the articles, about five, several times. I listened to a radio show. All of this acclimated me to the concepts and the lingo so that the book is decipherable. Also, I discovered it is essential for me to print out the charts in the book, because flipping pages with a magnifying glass didn't work very well. Good luck!

Thanks, ACS. I was complicating it a bit. The explanation in Chapter 6 is pretty clear, but the definition in the glossary is baffling. But, Al Rules! Basically, when a breakout fails, we don't know if it's just a failure or if it's actually a breakout pullback until we see if it has just "failed" and the prevailing move resumes, or if it makes a 3rd leg in the direction of the previous breakout, then it turns out it was a breakout pullback after all. So, it's impossible to actually name that "elbow" precisely until we see what happens, right? Thanks for your help.

First of all, I am very grateful to have found this book. I've been studying for several months and am doing very well with it. Some things that helped were watching the videos several times to get warmed up to the concepts and the lingo. Then, the articles. Finally, I found it essential to go to brooks price action - Home and print out charts so I could see them! My ongoing confusion, though, is the concept of "breakout pullback." Is this simply a little pullback after a breakout? It seems, from what I read and parse something more. Like: price is in a bullish uptrend, say at 900. It "breaks out" downward to 890. This is the breakout. This fails, and price returns to the 898-900 area. This is a failure of the breakout. It then attempt to break out again, and falls back to the 890-892 area. Is this the "breakout pullback?" Is it a pullback to the area of the orignal breakout, and a potential setup for a long if it fails? Am I making this hard and it is it just the 2nd of two attempts to breakout and thus a with trend setup? Help! Please!

It's interesting that your traps at bar 4 and 12 were also "implied" H1 and L1 pullbacks, where the single countertrend candles may have been more clearly identified as pullbacks on a faster chart. Another thing I've noticed is that EMA gap plays will sometimes show up on a daily 8:30 to 3:15 chart, but they won't show up on a 24 hour chart in the first hour and forty minutes of trading. For example, the gap pullback 2nd attempt at bar 16. This isn't on a chart that plots 24 hours since the EMA actually plots differently for the first 20 5-minute periods of the regular session. It's one of my favorites.

Thank you. After the HH marked bar around 7:30, why isn't the second candle after that the H1, and the second candle after that the H2? Did you just pay more attention to the fact that it's just the same pullback with a little wick making it higher than the previous candle? I love your book. Thanks for all of the work.