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Understanding Reverse Levels in Trading

May 10, 2025

Lecture on Reverse Levels

Introduction

  • Discussion focused on reverse levels.
  • Analysis conducted over different time frames.

Key Concepts

Reverse Levels

  • Reverse levels are points used to predict future interactions with past levels.
  • Combination of deep diving, laddering, and base point.
  • Create base of a move, leading to large breakout areas.

Base Points

  • Act as origins for moves.
  • A move can create a base point that leads to breakouts.

Analyzing Levels

Different Time Frames

  • Analysis conducted on various time frames: 3 minutes, 1 minute, 15 minutes, 1 hour, and 4 hours.
  • Importance of marking levels for clarity.

Importance of Ladders and Trends

  • Laddering up through a trend post hitting a level.
  • Importance of holding a move or creating a trend.

Whole Levels vs. Reverse Levels

  • Whole levels hit and bounce, while reverse levels act as future holds.
  • Whole level: immediate interaction, while reverse level: future potential interaction.

Practical Application

Steps in Analysis

  1. Identify and mark various levels on the chart.
  2. Analyze how levels interact with trends.
  3. Use levels to predict future movement or trend creation.

Criteria for Reverse Levels

  • Must wick through a level and act as a future hold.
  • Reverse levels alter the chart's architecture.

Using Reverse Levels

  • Act as hold levels in future moves.
  • Can create laddering opportunities or base moves.

Examples and Scenarios

Exploring Examples

  • Analysis with different examples using time frames and level interactions.
  • Discuss scenarios of how levels create bases or reverse actions.

Understanding Hold Levels

  • Final hold levels in moves can determine trend continuation or reversal.
  • The significance of the "greedy point" in a move.

Conclusion

  • Reverse levels provide insights into future market moves.
  • Identifying and understanding the context and criteria of reverse levels can improve trading strategies.
  • Thorough analysis of levels and trends is crucial for effective decision-making in trading.