I've been watching BIDU here and there, watching for the higher time frame 3d criteria setup to develop (shaded area in the chart below, left).
I thought this would be a good example to profile because of the difficulty which the "triggers" proved to be. The important consideration for this setup to exhibit is strength in price recovering a significant market structure high (look left for pivots).
The Blue up-arrows (on the 15-min chart below, right) are potential long entry "triggers". The black down arrows are instances where the fast line and slow line cross, which should be an "at most" stop out metric. The blue trendlines and horizontal line at $86 indicate significant pivots for price to take out, so when you see an up arrow, look to the left and see which pivot that price needed to close above.
There were some short entries to consider, but I wanted to focus on the 3d criteria setup. Of the 5 potential entries, 2 were scratches and 2 averaged both a $0.50 loss per share (which could have been helped with shorting the failure of the setup. That is, had you waited for the fast line and slow line cross to tell you to get out, depending upon your comfort with reading price action, some of these trades could have been managed for better results. So, at wost, you may have lost $1/share but currently be in a position with an approximately $6/share reward
Potential triggers after the jump:
The setups I include on this blog are used in conjunction with the 3/10macd and the criteria I ascribe to it as a way to alert me to an existing condition of price. The key concept to take away from this blog is that I try to anticipate what will happen on the higher time frame by using a faster time frame to trigger the trade setup. I do not trade a "system" I use two indicators to clue me in to price conditions. Please read the Disclaimer located in the sidebar of this site. I can be contacted via email at firstname.lastname@example.org
I am always open to questions, comments, or suggestions on how to improve this blog.