We will now describe a very important subject – exact timing of trades. Until this point we have discussed the scenarios which we will trade (bounces and pullbacks). Now we will describe when exactly each scenario is confirmed – and a trade should be entered. Do not worry if the rules are not completely understood – numerous examples of these techniques will be given in the following chapters.
Bounce
Bounce is confirmed after:
1. Price created one candle in the opposite direction of previous candle.
2. A second candle passed the low of the previous (for short trades) or high (for long trades).
Examples:
Pullback
Pullback is confirmed the same way as bounce. At all future chart pattern examples, exact entry point will be marked. Next chapter Money Management
1 comments:
I like trading the pullback too, it's so reliable. Thank you for your posts, very useful.
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