I have a question on

    Posted by focus175 on 16th of Aug 2020 at 01:55 pm

    I have a question on improving sell rules. I either buy in the pattern on a trigger or at a break above the upper TL of say a coil, then I place my stop (either a little below the last higher low in the pattern, or just below the pattern). Many times as you know, price breaks out and retests the TL. What I’m trying to determine is how often when price retests the break of the TL, does it go back into the pattern and then reverse and break out again and resume the uptrend, versus price breaks out, reverses and comes back into the pattern, and then sells off and starts a downtrend. Like what are the clues, other than a big bearish engulfing candle and heavy volume, that point to, hey it may be wise to sell before hitting your stop. 

    Aka, I’m trying to determine if probability wise, if price comes back into a pattern, how much room should I give it, before the probability of it continuing an uptrend starts decreasing…as I’d rather sell it early before it hits my stop loss, IF the price action of price breaking out, and then reversing back into the pattern “x%” or to a certain FIB level in a pattern, lowers the probability of it turning back to the upside, breaking out again and continuing the uptrend. 

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