Trading Congestion Action - Stock Trading Strategy (Part 1)

We speak here of congestion action trading .  A market that is in congestion action is a market that oscillates back and forth between the confines of congestion , between support and resistance ( or between the block level and dotted line in the terms of Drummond Geometry ). Within congestion this market action occurs, and when there is not a trend run. The level that was created by the preceding up trend’s highest high is what is referred to as the Dotted Line, or the lowest low created by the preceding down trend . The low of the very first bar that closes on the other side of the Pldot within an uptrend is the first Block Level , or in a down trend, the high of the first bar to close on the PLdot’s other side .

Once you have a sufficient understanding of the patterns, characteristics, and theory of congestion action trading, it can be quite lucrative . It is much like crop harvesting . You can earn your bread and butter with congestion action trading…. and even more, a table to hold the bread can be bought, and the house to hold the table , and for the house you can buy an estate, and the boat, care, plane, drivers, and so much more. Essentially, you have a huge potential to make money with this type of trading, if you take congestion action trading and learn all you can.

What exactly is congestion action trading anyway?

One effect of stock trading strategy this way through Drummond Geometry is that you get definitions that are very clear. Price is either in a trend run or it is not . When after more than three closes are on the PLdots one side and then it closes on the PLdots other side, this is not a trend run . If there is no trend run, then the market is in a congestion. It’s very clear and simple .

When the price ends up closing on the other side of the trending dot, the first bar is the congestion entrance bar . Then it can be said that the market is in congestion by definition . We know when the market first enters congestion a block level and dotted line are created . This block level is the first block level of the congestion . So , the name for this market action is congestion action which starts with a congestion entrance bar and continues for an indefinite period of time until on one side of the PLdot there are three closes, which marks the start of a new trend .

Let’s take a look at how congestion limits are defined with stock trading strategy, and how they can expand .

Congestion action defines the parameters of congestion , which may be called the confines of congestion.  Keep in mind the confines of congestion get defined by the block level and dotted line, and that the first block level is established by the congestion entrance bar .  These levels can be expanded upon. If prices goes outside the dotted line, or outside of the block level , while there is still congestion in the market ( without three closes being on the PLdot’s one side ), then price redefines the congestion confines and a larger congestion can occur. Before a new trend run occurs, this can happen various times.

This discussion of congestion trading will be continued in the stock trading strategy series.