initiating trade

This is the opposite of responsive tradeA responsive trade is a counter-trend trade taken against a specific level. The theory is that when two sided trade is taking place, there will not be enough momentum to push past key levels and buyers or sellers will respond to those areas, essentially pushing prices away from them. This is the opposite of breakout or initiative trade which is more directional in nature and is generally taken in the direction of the prevailing trend.. Initiating trade is when new money buyers or sellers step into the market and push prices to the next area of balance. Initiating activityA more one sided trade that takes place when the market pushes out and away from a current balanced area, into a new level where it establishes a new area of value. Initiating activity is generally dominated by the other time frame participants. When the market is experiencing initiating activity, you do not want to fade or go against the trend. You want to get aboard the train as early as possible and ride it to the next stop. See Responsive Activity, Other Time Frame. is essentially the start of a new trend and often starts with a breakout of prices breaching certain levels that were thought to be support or resistance prior. Initiating trade should be accompanied by an increase in volume as new money joins in to commit to the higher or lower prices.