Place your risk marker just below the recent higher low on the intermediate or micro chart. This keeps your dollar risk minimal while giving the macro trade room to breathe. Key Tools: Moving Averages and Anchored VWAP
Shannon uses simple moving averages (SMAs), such as the 10, 20, and 50-period averages, to help define the trend. When these moving averages are aligned upward (10 > 20 > 50) and sloping higher, the market is in Stage 2. When they are tangled and crisscrossing each other, the market is likely in Stage 1 or 3. Prices trading above or below a critical moving average like the 50-day or 200-day SMA provides further trend confirmation. Place your risk marker just below the recent