The 1-2-3
The three-step structure that establishes the move before a PTB entry.
The bullish and bearish versions mirror each other.
| Step | Bullish | Bearish |
|---|---|---|
| Step 1 | Break above the active 10/20 area | Break below the active 10/20 area |
| Step 2 | Consolidate or retest around the averages | Consolidate or retest around the averages |
| Step 3 | Expand clearly above the consolidation | Expand clearly below the consolidation |
Stoic Trader prefers a full close for clear Step 3 confirmation in the examples.
The first PTB in a new move follows the clear 1-2-3. Later clean PTBs may continue the move while price respects the 10/20 momentum structure.
Repeated crossings through the moving averages indicate chop. Failed or ambiguous structure returns the decision to Wait.
Related: Pullback Trigger Bar and Trade management.