Strategy Library

Price is trending up, dips down, taps one of the key moving averages — the 8, 21, or 50 EMA — and rejects: closes back above that same line on a green candle. Any of the three counts. The idea: in a healthy uptrend, these lines tend to act as dynamic support — each tap is buyers stepping back in before the trend continues, rather than a break in the trend.

A tap-and-reject that loses the EMA again the very next day usually means the bounce wasn't backed by real buying — just a brief wick back above the line. Follow-through over the next day or two matters more than the single signal candle.

Price has been consolidating in a tight range — tight relative to that stock's own typical daily range, not a flat percentage that would be meaningless across tickers with very different volatility — then closes above the previous day's high on real volume. This doesn't require clearing some older high from earlier in the base; the level that matters is the one right in front of it (PDH), not a stale high from days ago.

The interactive chart's intraday views (1m through 4h) work differently. Each timeframe independently checks its own candles against the same PDH-based level — requiring a close above it with volume above 1.2× that timeframe's own 20-bar average — without waiting for the daily candle to close, and without requiring the full daily rule above to have fired that day. A breakout confirmed on 1m does not imply it's confirmed on 5m, 15m, or any other timeframe — each is evaluated on its own. A candle that trades above the level but closes back below it is marked as a sweep (a muted gray dot), shown for context but never counted as a signal.

Breakouts without real volume behind them ("wick breakouts") often reverse quickly — price pokes above the level intraday but can't hold it by the close, or holds for a day and then fails on the next. A breakout on unremarkable volume is a weaker signal even if the price technically cleared the level.

Price dips below the previous day's low — often running the stop-losses sitting right below it — but reclaims that low and closes back above it by end of day. The dip below isn't automatically bearish on its own; what matters is whether sellers can actually keep price down there, or whether it gets bought back up almost immediately. A failed breakdown is often a sign control has shifted back to buyers.

Not every dip-and-recover is meaningful — since this checks only the single prior day's low, it can fire on ordinary day-to-day noise around a level with no real significance, not just at levels other traders are actually watching.