Keltinger Moat

Yea, we’re gonna start with some interesting Bollinger settings to spot / participate in a trending market with a simple set of rules.

The sample size is 44 and the standard deviation is set to 0.8

It is a good idea to look for a narrowing of the bands. Take note of the pop in one direction. When the outer limit gets taken out – that’s your safe entry with a limited size risk: the stop loss could be placed under the swing low that was printed piercing the middle line (44MA). The early bird can start with and even smaller risk entering at the upper band, and the bird that does not sleep could have a go at the top of the doji further minimizing the risk.

Adding is promoted until a struggle becomes obvious by printing 3 fractals at approximately the same level and have corrections between them, not mere pullbacks. There are no definitions over this, but if you compare the middle section with the white line area, the depth of the corrections in the latter are in excess of 200 pips each.

Now, let’s discuss a possible usage of the Energy Bands or Moat, my personal invention.

During the expansion of volatility the moat itself can be hit multiple times, but this should not be taken as weakness / reversal, au contraire.

The first encounter with the green moat on the right did not happen on a lower low (the swing low was set in the valley prior).

The two bands are not symmetrical, so the upside and the downside work in a slightly different manner.

On the upside you need to have seen a hit before in the same direction, but the preceding hit had to be more than 6 days earlier for an instant sell.

On the downside the hits are scarce: they have to match the rhythm. After a hit happens, you need 6 days off before a bona fide entry – and by then the price may be well on its way as the first example shows (it granted a doji though graciously to make the entry easier).

I guess you could exit the shorts on a hit of the green moat – but then go back in again upon the violation of that daily low – one time.

I kept the Keltinger bands on for you to spot the continuation entries – both on the downside and the upside, as well as to find the railroad tracks which are the sign of severe lack of energy, every ounce being gathered to make that beat (the first move off the railroad coil is in the wrong direction).

Currently the 7 sample CI reading is 71+ which is extremely high and may be a sign of a long travel ahead – odds do not favor the downside now that the count is up, Dracula.

The Violet V-s are Volatility Whips (another personal contribution), the five legs are always identifiable on any time frame, and they do not comply with the E.W. principles of no overlap or 3 has to be the largest – as you can see from the blue structure above.
six counts

Optimal short and long entry>

The fact, that I had 1.1763 as target (Projected Distance – proprietary routine by Macdulio) from the 6th of July speaks to the genius of the professor of trading. The fact, that I have not been trying to short the heck out of this market until this level came up speaks to the undisciplined, doubtful trader that I am.

As you can see, the projection is not a range, not an either this or maybe that, but a call within five pips of the actual target.
Distance projection has nothing to do with market profile, volume profile, trendlines, Fibonacci or harmonics, it is merely a distance multiplication by a constant I found relevant.