Price Action: Strong Trends

The most important sign for identifying a strong trend is consecutive strong trend bars. For example, two or three consecutive bull bars with large bodies closing near the high; or two, three, or four consecutive large bear bars with large bodies closing near the low.

What you are looking for is a strong breakout from trading range price action, or a strong reversal.

If the trend is truly strong, you can actually do nothing — just sit there and let the market bring you substantial profits.

Always In Long or Always In Short. This means: at this moment, if you must hold a position, should you be long or short?

Usually you can tell just by looking at the chart. If the market is in free fall, I would never consider going long — I would only think about going short. If it is a strong rally, I would only think about going long.

If while looking at the chart I think: "Man, I should go long. I really wish it would pull back a little so I could buy." Then what should I do? I buy immediately at market price.
Because whenever I "wish it would pull back," it means everyone is waiting for a pullback. This means everyone will rush in at just a one or two tick dip rather than waiting for a three or four bar pullback. Whenever I start "wishing for a pullback," that is my signal to enter immediately.

As for the stop loss, I do use a wider stop loss. If I see a strong bull breakout, my stop loss goes below the bottom of that breakout bar; if it is a bear breakout, the stop loss goes above the top. Since the entry is far from the stop loss, my position size must be very small. However, even with a small position, if the market continues running in one direction, the final profit can be very substantial.

The market is always searching for direction, so it is constantly probing up and down — it needs to find out "what is too far."

If you are still confused about market cycle identification, how to combine implied pullbacks and channel structures to determine the highs or lows of a trading range, then look at more charts, annotate more, and find the rhythm of "breakout — channel — trading range" transitions.
Once you can identify these structures, you will better understand why certain highs or lows become test targets. Because it is the starting point of a pullback from a bear breakout entering the channel phase — and the starting point of a channel is often the edge of the trading range.
So these are not price levels guessed out of thin air but follow the "evolutionary logic of market behavior."
This also explains why Al Brooks frequently emphasizes the interrelationship between pullback structures, channel starting points, and trading range boundaries — because this helps you anticipate where price might go, rather than only reacting after the fact.