Phil, thanks for your insight. I'm excited to give this method of trading a try, and incorporate it into what I've already been doing with S&R and scalp lines. I have three questions:
When you evaluate and chart your trend lines, do you do so on the 4 HR chart or on the daily TF and then verify the points that the lines are touching on the 4HR? It seems like you'd have the opportunity to find smaller trends on the 4 hr, but when you zoom out to daily you tend to see them as corrections of a larger trend.
My second question regards S&R zones. I've got a good handle on scalp lines, but charting more historical S&R is a bit more of a challenge. Like your trend lines, do you do this on the 4hr chart or look for the bigger picture on longer time frames?
Finally, I've got a scenario question. If you have a really wide S&R zone, say 100 pips, and you find that your logical stop loss for a long trade lies 150 pips away behind the S&R resistance. Do you think twice about the trade if the nearer S&R support or a bottom of the trend line are less than 150 pips away? This would seem to give you the possibility of a larger risk than reward for a potential trade if you exit on a bounce and reversal from the closer line.
Cody
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