One of the things that is always running through my mind when trading is… which chart is in control of price? This isn’t which chart is your control chart for your trade it’s which one of the charts that you use in your trade system is in control.
For those that adopt the RDTS that means you’ll looking to see which one of the charts- 1, 3, 4 is in control of price action. Sometimes that doesn’t get you there, then you’ll want to step it up to the 240 or the D.
In this example it appeared chart 3 was in control. So we then use C1 and c4 to backup this assessment. To get here we used the 3Qs and part of going through that process we realize the time of day.
It’s the lunch session and we don’t expect any major breakthroughs so here while c3 is in control the immediate trade appears to be a fade. But the overall direction and bias on of the market is LONG.
The pullback did happen, which aligns with c3 still being in control given where the momentum indicators are. Still the key level that has yet to be tested on this chart is still in play to the upside.