Disliked{quote} First of all hats off for doing historical research thats how real trader approaches the market. It is correct that those two parameters you described is a powder keg to create squeeze situation as it was clearly explained on takeout patterns on previous pages, there is no secret sauce to it why is that.Ignored
Everybody knows that price is looking for liquidity. Price moves to find liquidity. Price jumps to find liquidity. Bad fills happen when price looks but cannot find. And it moves and moves.
I see parabolic moves as liquidity gaps for the simple reason that there wasnt enough time for the human to plan and execute a market order in that area. Its a risky area for limits too as traders tend to use structures (e.g. hi/lo) for backup. For that reason corrections look similar to the initial move.
But i cannot say that for diagonal condensed areas. Even though these areas may produce parabolic moves, the reason for lack of orders after the takeout, is different. Traders should approach left side (TP zone) of the chart same way as Jan does with the pattern he trades. Then it will be obvious which setups produce quickest trades with lowest DD.
@Jan: i am currently creating a dynamic decision tree out of your general rules for the rotation pattern. It will contain few posible variations, which will be backed up with many example in order to create statistical relevance. I want to challange the micro shelf and the takeout. Will keep you up to date about the progress.