Learning About Trading Congestion Action with Stock Trading Course

Congestion action trading is the topic for today. Congestion action in a market is a market that oscillates back and forth between the confines of congestion , between support and resistance (or, in Drummond Geometry terms, between the dotted line and the block level ). It is market action that occurs within congestion itself , and when no trend run is occurring . The level that was created by the preceding up trend's highest high is what is referred to as the Dotted Line, or the very lowest low that the preceding down trend created. In an uptrend the first bar that closes on the PLdot's opposite side is known as the first Block Level, or the high of the very first bar on a down trend that closes on the other side of the PLdot.

Once you have a sufficient understanding of the patterns, characteristics, and theory of congestion action trading, you can make a lot of money in this type of market . It's a lot like harvesting a good crop. You can earn your bread and butter with congestion action trading.... and even more, a table to hold the bread can be bought, and a house for the table , and for the house you can buy an estate, and the car, the driver, and the boat, and the plane, and all the other toys or essentials you may or may not desire . Basically , congestion action trading holds a lot of potential for you , if you take time to learn everything you can about it .

Congestion action trading - what is it ?

One effect of stock trading course this way through Drummond Geometry is that you have clear definitions . There is a trend run for prices or there isn't . When after more than three closes are on the PLdots one side and then it closes on the PLdots other side, this is not a trend run . When the market is not in a trend run, then it is in congestion . It's very clear and simple .

The first bar when there is a close on the trending dot's opposite side is the congestion entrance bar . Then it can be said that the market is in congestion by definition . When congestion is first entered we know that this creates a dotted line and a block level . This block level is the first block level of the congestion . Thus , congestion action is the name for that market action which gets started with the congestion entrance bar and goes on for a time that is not defined until we see three closes on one side of the PLdot , which marks the start of a new trend .

Let's take a look at how congestion limits are defined with stock trading course, as well as how expansion can occur .

Congestion action defines the parameters of congestion , which is also known as the confines of congestion . Remember the confines of congestion get defined by the block level and dotted line, and the first block level gets set up by what is known as the congestion entrance bar. But these levels can be expanded . If the price ends up going outside the dotted line or block level, while still in congestion ( without three closes being on the PLdot's one side ), then the confines of congestion are being redefined by price and there can be established an even larger congestion . This can continue several times until a new trend run appears .

This discussion of congestion trading will be continued in the technical analysis explained series.


Author:
Ted Hearne is a Forex and bond trader who has written extensively about trading and has co-authored a "stock trading course" called "Drummond Geometry". His biography and further information about his work can be found at the www.drummondgeometry.com website.