Trade Framing is our name for constructing a decision-support framework to trade symbols that are in a critical state.
A Critical State is a moment when there is an abnormally large probability of:
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- A larger-than-normal move,
- In either direction with a reasonable probability,
- In a Shorter-Than-Normal period of time,
- And where the “execution risk” is much smaller than the reasonably available gain, in both directions.
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When we find a critical state, we frame the trade in both directions by systematically answering the following standard questions:
For a trade frame:
- What do you see?
- What could it do?
- Which way would you trade?
- Where would you enter?
- Where would it fail?
- Would you stop and reverse?
On a win:
- Where would it stall?
- Where would you preserve?
- Where would it then go?
- Would you stop and reverse?
- Where would you re-enter?
In this video, Ken discusses trade framing and the power of Hybrid Trading to find opportunity where other people only see boring, routine price movement on daily charts.
