Microdetection of Sentiment Reversals The Use of Price Break Charts for Momentum Trading

In many markets, phenomena such as economic data releases, important speeches, and election results may cause a reaction in the market and a sharp and quick movement in prices. Such movements seem to pose insurmountable challenges for traders. A common practice among traders who anticipate an economic data release is to stand on the sidelines and let the market react to the news. However, the challenge for the trader—finding an entry position after the economic data release breaks—still remains. Price break charts provide a solution to entering a trade in the context of a high-momentum or volatile development.

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One-Minute Time Interval

Figure 4.4 Six Line Break on One Minute Chart

Source: Chart copyright www.ProRealTime.com

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One-Minute Time Interval

Figure 4.4 Six Line Break on One Minute Chart

Source: Chart copyright www.ProRealTime.com

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