I Know How You Feel, But You Will Get It!
your key to major league quan… The ADX Break Pattern… your key to major league quan…
This trade has a 90% win rate when done correctly!
The ADX break represents panic selling…
Remember this set up! Mastering just one pattern can make your rich!
The ADX line… An ADX line measures the strength (not the direction) of a trend. An ADX above 40 shows a strong trend. The higher the better. ADX’s above 60 are more rare, but are beautiful things!
The ADX break pattern… An ADX break is a pattern identified by: A falling stock price. Panic selling best. Increasing sell volume. Capitulation/Reversal signs. An ADX that turns (breaks) preferably above 40. Reversing of the stock price. Buy volume comes in.
“Be the fly on the back of the elephant, and go for a ride…”
Don’t be the first into battle….
Finding ADX breaks to trade… Our chat room. Use ADX scanner. CNBC bad news. 10 in 1 desktop.
Separation (from the MA’s) Support (on larger time frames) Let the Pattern Work Remember… Shape (waterfall) Separation (from the MA’s) Support (on larger time frames)
Look for the Three S’s for a Perfect ADX Shape, Separation, and Support
Determining entries….. At ADX turns above 40 on best shaped chart, and... With first break of a previous 2,3,5 minute candle’s high, and… With capitulation/reversal signs, and… When red selling volume turns to blue buying volume. Initial stop at low of day/bottom.
Reversal signs are key…
Capitulation signs In an ADX break pattern, one will often see increasing red blow-off candles, as the last of the sellers get out of a stock. The last candle at the bottom may be a change-up, doji, hammer, double bar, bullish engulfing, long red candle with a long buying tail.
Capitulation signs…
Stocks Take the Elevator Down and the stairs up… A stock that has fallen far and rapidly in minutes (10% or 15%) may take hours to reverse… Be patient! Mow the lawn!
Beware the corndog…
The setup needs much more than just a high ADX… Watch for fake- outs. Look for increasing sell volume, then buy volume, and a defined ADX break. This set-up (left) does not show capitulation, or a distinct ADX break, or volume change.
If faked out, watch and re-enter at true break…
Perfect waterfall shape, longer red candles…
The safest ADX breaks occur when the market is sideways or going up, and the price falls to a 50 or 200 moving average on the daily chart. Look for that support on the daily!
Big fall to the daily MA…
Don’t be a fairy….these can be huge money makers!
July 1, 2015, Feds announce airlines being investigating for price fixing.
ADX break example #1
ADX break example #2
ADX break example #3
The research proves it!
Don’t be a horse’s ass. The biggest mistakes are getting in before the turn, and getting out with a little fairy trade only to watch the stock come all the back.