How to recognize false breakouts in trading?
Hello,
I'm learning day trading and I have a question. I've seen videos that explain how to recognize false breakouts. I saw that you have to look at the lower timeframe and chart pattern to recognize it. In the first picture you can see gold on a 4-hour chart (4h). As you can see there is a small yellow box on the last bearish candle, before the large green candle appeared. You can also see an order block that I drew in blue where the yellow box is partly in this blue zone. But if you look at the last bearish candle, it left this blue zone and rose dramatically. That would have been a false breakout because it should have hit the next blue zone on demand because it left the zone. In the second picture I chose the lower timeframe to 15 minutes and recognized an (M) pattern. Why did the price rise despite this pattern? In the third picture you can see that this pattern is a double top.
1. Image
2nd picture
3rd picture
(3 votes)
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First picture: Holy moly you have drawn many zones. Most aren’t paying attention to what so many? The drawn line only applies from 3x andotzen anonsten ist it senseless
2nd picture: This is a 15m chart, the more you get smaller in the time unit, the more unlikely it is that patterns are relevant. Patterns are relevant in 1h time units and beyond.
3rd picture: These are sample examples, you will find them as good as never in practice.
What Smartass67 says, but is not true, patterns are good ways to trade after that, but they should be formed in 1h chart up. the M at your 15m chart did what it was supposed to be, but you didn’t get any entry, etc. This is something if you’re a full professional and have been trading for 5 years, then you can take something like that, forget it and specialize in larger time units. The smaller you have to be.
Wow thank you helped me ðŸ ̃‚
I hope so.
All typical images and yet that’s what you’re doing a bit far as astrology.
The future is not predictable and pure from a chart twice.
Without broad background knowledge, it is not possible to interpret such a thing meaningfully and therefore I mean background to political and economic issues.