Understanding Pullbacks

Insight

Most of the orderly upswings give you 3 pullbacks to enter. Watch ROSSELLIND closely:

• 1st pullback above the ribbon

• 2nd pullback touching the ribbon

• 3rd pullback inside the ribbon

Beyond the 3rd pullback, the probability of a further sustained upmove keeps on diminishing.

During their upswing, some stocks like to form bases of a few candles, & then breakout strongly. I find these upswings stronger than the “pullback” ones. Watch SRHHYPOLTD - 2 entries, with the entire action taking place above the ribbon:

• E1 = flat base

• E2 = ascending triangle

More complicated entry points can even be in the form of a small volatility contraction pattern (VCP) within the confirmed upswing. Watch GSS closely -

• E1 = pullback

• E2 = pullback

• E3 = VCP, more evident on hourly charts

• E4 = flat base