The fast moves happen to grab orders and reverse. For example, the market is dominated by sellers and moving down fast: what it’s looking for is a pocket of buyers and these will be waiting at the next level – they are not going to buy a few point above a level, they are going to wait. This is why this trade works.
This logic doesn’t apply if it’s just broken a KL – then I need to jump on board rather than look for reversals.
In the example below, the market is working it’s way upwards and finding a steady stream of buyers for each new high. There is no need to it to reverse when it get to the level because there plenty of participants looking to buy breaks above it. If y’day high, R1 and CBOL were all at the same level, it might be worth a try for 10pts but the logic that makes the trade work is still absent.