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CTS-full steps - plus Stochastics

 Ah, thank you for the critical clarification. My apologies for making the standard assumption.

You are describing a momentum-based, trend-following strategy. This is a completely different and very powerful way to use the Stochastic oscillator. Instead of looking for reversals (buying low, selling high), you are looking for confirmation that a strong trend is likely to continue.

Let's rebuild the entry logic with this correct understanding.

The Corrected Logic: Trading with Momentum

  • Buying High (near 65): In a strong uptrend, you are not waiting for the price to become "oversold." You are waiting for it to show strong bullish momentum, which is indicated by the Stochastic reaching the upper end of its range. You are essentially "buying strength." A move to the 65 level in a confirmed uptrend is a signal that buyers are aggressive.

  • Selling Low (near 35): In a strong downtrend, you are not waiting for the price to become "overbought." You are waiting for it to show strong bearish momentum. A move to the 35 level in a confirmed downtrend is a signal that sellers are in firm control, and you are looking to join that momentum.

This is an excellent way to filter out weak moves and only participate when there is conviction in the trend.


The Final, Corrected Six-Layer Trading Plan

Layers 1 (D1/H4 Context) and 2 (H1/M30 Confirmation) are now even more important because they establish the primary trend you intend to join.

Layer 1: D1/H4 - The "Map"

  • Action: Confirm a clear, strong primary trend. The moving averages should be fanned out and pointing in one direction. Draw your Fibonacci to identify key S/R levels.

Layer 2: H1/M30 - The "Compass"

  • Action: Confirm the medium-term trend is aligned with the D1/H4 trend using your moving averages. A strong trend will have the price consistently riding above (for uptrends) or below (for downtrends) the MA(60).

Layer 3: M15 Bollinger Bands - The "Volatility Check"

  • Action: This layer's role changes slightly. You are now looking for signs of a "momentum push."

    • In an Uptrend: You might see the price "walking the band" - consistently touching the upper Bollinger Band.

    • In a Downtrend: You might see the price "walking the band" - consistently touching the lower Bollinger Band.

Layer 4: M15 Stochastic - The "Momentum Trigger"

  • Action: This is now your primary trigger. You wait for the Stochastic to reach the level that confirms strong momentum in the direction of your trend.

Layer 5 & 6: M15 Price Action & Execution

  • Action: You combine the Stochastic signal with a classic price action pattern to get your precise entry and stop-loss.


The New Entry Scenarios in Detail

For a BULLISH Entry (Buying Strength)

You have confirmed a strong uptrend on D1/H4 and H1/M30. You are looking to buy.

  1. Stochastic Trigger (Layer 4): You wait for the Stochastic to reach or cross above your 65 level. This is your signal that bullish momentum is strong.

  2. Price Action Entry (Layer 5): You don't just buy blindly. You look for a small, tight consolidation pattern on the M15 chart while the Stochastic is high. This is called a Bull Flag or a High and Tight Flag.

    • The price makes a strong push up (the pole).

    • It then moves sideways or slightly down in a tight channel (the flag).

  3. Execution (Layer 6):

    • Entry: Buy the moment the price breaks above the top trendline of the flag.

    • Stop-Loss: Place your stop-loss just below the low of the flag pattern.

For a BEARISH Entry (Selling Weakness)

You have confirmed a strong downtrend on D1/H4 and H1/M30. You are looking to sell.

  1. Stochastic Trigger (Layer 4): You wait for the Stochastic to reach or cross below your 35 level. This signals strong bearish momentum.

  2. Price Action Entry (Layer 5): Look for a small Bear Flag.

    • The price makes a sharp drop (the pole).

    • It then moves sideways or slightly up in a tight channel (the flag).

  3. Execution (Layer 6):

    • Entry: Sell the moment the price breaks below the bottom trendline of the flag.

    • Stop-Loss: Place your stop-loss just above the high of the flag pattern.

Summary of the Corrected Workflow

  1. Confirm a strong, clear trend on D1/H4 and H1/M30. (This is the most important step for this strategy).

  2. Wait for the price to be in a "momentum push" phase (e.g., near the outer Bollinger Bands on M15).

  3. Wait for the Stochastic to confirm this momentum (crossing above 65 for buys, below 35 for sells).

  4. Once momentum is confirmed, find a small flag pattern on the M15 chart.

  5. Enter on the breakout of the flag and place your stop-loss on the other side of the flag.

Thank you again for the correction. This momentum-based approach is a distinct and valid strategy that now accurately reflects your intention.

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