the playbook
Base Breakout
testing · from the shelf no record Entry. LONG. A base: the prior twenty bars inside a band no wider than a quarter of its high. Trigger: a close above the base high on at least one and a half times the base's average volume. A wick through it is anticipation.
Stop. Under the breakout bar's low by half a percent. If that is more than eight percent from the entry the trade is skipped, not widened.
Exit. Two R, or a close below the breakout bar's low - or back inside the base, if the breakout bar's low is higher - whichever comes first. Twenty bars without the target and the time stop takes it off.
Trend Pullback
testing · from the shelf no record Entry. LONG. An uptrend: the twenty-bar average over the fifty-bar and higher than five bars ago. Trigger: a bar whose low comes down to the twenty-bar average, within one percent, and closes back above it.
Stop. Under the pullback's low - the lowest of the last three bars - by half a percent.
Exit. Two R, or a close below the fifty-bar average, whichever comes first. Twenty bars without the target and the time stop takes it off.
Bollinger With The Trend
testing · from the shelf no record Entry. LONG. Above the 200-day average. The prior close under the lower Bollinger band (twenty bars, two deviations); this close back inside it. A dip bought inside a standing uptrend.
Stop. Two ATR under the close. If that is more than eight percent from the entry the trade is skipped.
Exit. One R, or a close at the middle band, whichever comes first. Twenty bars without the target and the time stop takes it off.
Bollinger With The Trend (Short)
testing · from the shelf no record Entry. SHORT. Under the 200-day average. The prior close over the upper Bollinger band; this close back inside it. A bounce sold inside a standing downtrend.
Stop. Two ATR over the close. If that is more than eight percent from the entry the trade is skipped.
Exit. One R, or a close at the middle band, whichever comes first. Twenty bars without the target and the time stop takes it off.
Trend Bounce
testing · from the shelf no record Entry. SHORT. A downtrend: the twenty-bar average under the fifty-bar and lower than five bars ago. Trigger: a bar whose high comes up to the twenty-bar average, within one percent, and closes back below it.
Stop. Over the bounce's high - the highest of the last three bars - by half a percent.
Exit. Two R, or a close above the fifty-bar average, whichever comes first. Twenty bars without the target and the time stop takes it off.
Breakdown
testing · from the shelf no record Entry. SHORT. A base: the prior twenty bars inside a band no wider than a quarter of its high. Trigger: a close below the base low on at least one and a half times the base's average volume.
Stop. Above the last five bars' high by half a percent.
Exit. Two R, or a close back inside the base, whichever comes first. Twenty bars without the target and the time stop takes it off.
Flag Pennant
testing · from the shelf no record Entry. LONG. A pole: ten bars that rose at least twelve percent from their low to their high. A flag: the four to twelve bars after it that held within eight percent of their own high, stayed under the pole's high, and gave back less than half the pole. Trigger: a close above the flag's high.
Stop. The flag's low. A flag whose low is more than eight percent from the entry is not a flag; the trade is skipped.
Exit. Two R, or a close below the flag's low, whichever comes first. Twenty bars without the target and the time stop takes it off.
Bear Flag
testing · from the shelf no record Entry. SHORT. A pole down: ten bars that fell at least twelve percent from their high to their low. A flag: the four to twelve bars after it that held within eight percent of their own low, stayed above the pole's low, and recovered less than half the pole. Trigger: a close below the flag's low.
Stop. Above the flag's high by half a percent. A flag whose high is more than eight percent from the entry is not a flag; the trade is skipped.
Exit. Two R, or a close above the flag's high, whichever comes first. Twenty bars without the target and the time stop takes it off.
Breakout Retest
testing · from the shelf no record Entry. LONG. Within the last six bars a close cleared the prior twenty-bar high, and no close has lost it since. Trigger: a bar whose low comes back to that level, within half a percent, and closes above it in the upper half of its own range - the retest that holds.
Stop. Under the retest bar's low, or the level, whichever is lower, by half a percent.
Exit. Two R, or a close back below the level, whichever comes first. Twenty bars without the target and the time stop takes it off.
Breakdown Retest
testing · from the shelf no record Entry. SHORT. Within the last six bars a close lost the prior twenty-bar low, and no close has regained it since. Trigger: a bar whose high comes back up to that level, within half a percent, and closes below it in the lower half of its own range - the retest that fails.
Stop. Over the retest bar's high, or the level, whichever is higher, by half a percent. On intraday bars: one and a half ATR over the close, and never less than one ATR over that high.
Exit. Two R, or a close back above the level, whichever comes first. Twenty bars without the target and the time stop takes it off.
Mean Reversion Dip
testing · from the shelf no record Entry. LONG. An uptrend: the close above a rising fifty-bar mean. A dip: the last five bars' low came to the twenty-bar mean, or within three percent under it. Trigger: a close above the prior bar's high, the turn.
Stop. Under the dip's low by half a percent. On intraday bars: two and a half ATR under the close, and never less than one ATR under the dip's low.
Exit. Two R, or a close below the dip's low, whichever comes first. Twenty bars without the target and the time stop takes it off.
Lower High
testing · from the shelf no record Entry. SHORT. A downtrend: the close below a falling fifty-bar mean. A bounce: the last five bars' high came up to the twenty-bar mean, or within three percent over it. Trigger: a close below the prior bar's low, the turn down.
Stop. Over the bounce's high by half a percent. On intraday bars: two and a half ATR over the close, and never less than one ATR over the bounce's high.
Exit. Two R, or a close above the bounce's high, whichever comes first. Twenty bars without the target and the time stop takes it off.
Range
testing · from the shelf no record Entry. LONG. A range: the prior twenty bars inside a band no wider than twelve percent of its high, the low touched at least twice. Trigger: a bar that dips into the bottom one and a half percent of the range and closes back above it, in the upper half of its own bar.
Stop. Below the range low by one percent; on intraday bars, one and a half ATR under the close and never less than one ATR under the low. A close below the range low means the range is broken.
Exit. The range high, or a close below the range low, whichever comes first. The play wants the high at least one and a half times the risk away.
Range Top
testing · from the shelf no record Entry. SHORT. A range: the prior twenty bars inside a band no wider than twelve percent of its high, the high touched at least twice. Trigger: a bar that pokes into the top one and a half percent of the range and closes back below it, in the lower half of its own bar.
Stop. Above the range high by one percent; on intraday bars, one and a half ATR over the close and never less than one ATR over the high. A close above the range high means the range is broken upward.
Exit. The range low, or a close above the range high, whichever comes first. The play wants the low at least one and a half times the risk away.
Capitulation Washout
testing · from the shelf no record Entry. LONG. A flush: within the last three bars, one that broke below the lowest low of the twenty before it, on at least one and a half times their average volume, with its close at least eight percent below that lookback's twenty-bar mean. Trigger: a close back above that broken low AND above the prior bar's high.
Stop. The flush's low: the low of the bar that broke down and was bought back.
Exit. Two R, or a close back below the reclaimed level, whichever comes first. Twenty bars without the target and the time stop takes it off.
Blow-off Fade
testing · from the shelf no record Entry. SHORT. A run: the close at least thirty percent above the close ten bars ago. Trigger: a bar that trades above the prior high, closes below the prior close and in the lower half of its own range, on at least one and a half times the average volume - the first failure.
Stop. Over the failure bar's high by half a percent.
Exit. Two R, or a close above the blow-off high, whichever comes first. Twenty bars without the target and the time stop takes it off.
Failed Breakout
testing · from the shelf no record Entry. SHORT. Within the last three bars a close cleared the prior twenty-bar high. Trigger: a close back below that high. Everyone who bought the breakout is wrong at once.
Stop. Over the breakout's high by half a percent.
Exit. Two R, or a close back above the level, whichever comes first. Twenty bars without the target and the time stop takes it off.
Double Top
testing · from the shelf no record Entry. SHORT. Two swing highs within one and a half percent of each other, at least five bars apart, with a trough between them at least three percent below - the neckline. Trigger: the first close below the neckline.
Stop. Over the higher of the two tops by half a percent.
Exit. The measured move - the neckline less the height of the tops above it - or a close back above the neckline, whichever comes first. Twenty bars without the target and the time stop takes it off.
Double Bottom
testing · from the shelf no record Entry. LONG. Two swing lows within one and a half percent of each other, at least five bars apart, with a peak between them at least three percent above - the neckline. Trigger: the first close above the neckline.
Stop. Under the lower of the two bottoms by half a percent.
Exit. The measured move - the neckline plus the depth of the bottoms below it - or the stop; the pattern is given room, with no early exit on a close under the neckline. Twenty bars without the target and the time stop takes it off.
Head and Shoulders
testing · from the shelf no record Entry. SHORT. Three swing highs: a head at least two percent above both shoulders, the shoulders within three percent of each other, a trough either side of the head. The neckline is the lower trough. Trigger: the first close below the neckline.
Stop. Over the right shoulder by half a percent.
Exit. The measured move - the neckline less the head's height above it - or a close back above the neckline, whichever comes first. Twenty bars without the target and the time stop takes it off.
Inverse Head and Shoulders
testing · from the shelf no record Entry. LONG. Three swing lows: a head at least two percent below both shoulders, the shoulders within three percent of each other, a peak either side of the head. The neckline is the higher peak. Trigger: the first close above the neckline.
Stop. Under the right shoulder by half a percent.
Exit. The measured move - the neckline plus the head's depth below it - or the stop; the pattern is given room, with no early exit on a close under the neckline. Twenty bars without the target and the time stop takes it off.
Gap Fade
testing · from the shelf no record Entry. SHORT. The bar opened at least two percent above the prior close - a gap up - and closed below its own open, in the lower half of its range: the gap that failed. Trigger: that close.
Stop. Over the gap bar's high by half a percent.
Exit. The gap filled - the prior close, while it still sits below the close; two R otherwise - or a close above the gap bar's high, whichever comes first. The play wants the target at least one and a half times the risk away.
Gap Fill
testing · from the shelf no record Entry. LONG. The bar opened at least two percent below the prior close - a gap down - and closed above its own open, in the upper half of its range: the gap that was bought. Trigger: that close.
Stop. Under the gap bar's low by half a percent.
Exit. The gap filled - the prior close, while it still sits above the close; two R otherwise - or a close below the gap bar's low, whichever comes first. The play wants the target at least one and a half times the risk away.
A play is a trigger, a stop and an exit in the writer's words. The figure is the paper record, shrunk toward zero with a weight of twenty closed trades.