General:
- Only take / use 3-drives in mature trends; not in ranges
De V-rejection eindigt uiteindelijk in een double top en maakt equal highs. Vervolgens, na de 3-drive, lukt het de prijs niet om een higher high te maken. Integendeel, de double top welke ook distribution is, krijgt een retest met een middelgrote wick. Vanaf dit punt is de bias bearish, price action wise.
Do not go against strong V-rejections (blue). In this case the V-rejection is extra strong because it took out the previous extreme low (start red line) from which a new higher high was created.
Example of V-rejection in the middle of a trend:
A V-rejection followed by bullish structure will likely pullback deeper:
The last move before the V-rejection is called the V-rejection origin. This is an important area because it gets a retest often:. The box marked up the the last move before the V-rejection, the 2 bullish candles.
Ranges after a bullish V-rejection often are accumulations. The thin line indicates the accumulation. Do not trade against it.
A strong nice V often gets a retest at around 50% of the start (yellow lines):
Markup example of a retest of a V at 50%:
Liquidity taken and came back into support. Entry could be on red arrow:
Don't get confused when a V-rejection happens at a HH when it does not break the CHL. If it does not break structure and the level olds, it is a weak V and considered just a pullback. The image shows that the level is holding after the V and after the it did fail to break the low again. Stay bullish:
When a level is broken and seems to get a retest, look at price. Is it moving fast? It may be a liquidity grab. In the image there's a V-rejection below the level and in the middle there's accumulation which get a retest later on. This is very bullish. Also, there're a lot of highs that can be taken out. Bullish.
