One (of many) possible approaches that bubble up is to try lots of things (and/or trades) and trust the formal risk-management systems you have implemented (you have formalized your risk management haven't you?) to alert you to blind alleys and other, riskier, deviations from the critical path.
From Price Action Lab:
Since the start of this year, the S&P 500 Index has moved close to the upper-trendline of a 6-year long up-channel and it is now attempting a breakout to the upside. If successful, such breakout may fuel a parabolic up move. However, an enclosed wedge formation warns of the possibility of exhaustion and reversal.
Let me start by saying that lines drawn in the sand have only descriptive value, not predictive. This is true for any line that can be possibly drawn on charts in the context of technical analysis....MORE
