Getting back to where i was before.
It's time i really define the meaning of Touch Trade.
Touch Trade is not a blind trade,it is preplanned trade taken at right location.
Consider this thing say,i have a zone or a point inside the chart in any security or financial instrument,eg euro/usd at 1.2000.,what will be a touch trade in that area and what will be a PA trade.
Touch trade will be a order lying over there which was placed by me on some confluence and professional confidence in that area.
While a PA trade will be a bar confirmation in that area which would confirm my belief that really something was there in that area.
Textbook Example for touch trade, say we have:
1.2000 Round Number.
Swing Point.
61.8 fib on any daily confluence.
Or 38.2 fib.
With these factors alone, i can have full confidence in that area without seeing a bar confirmation.
While a PA or Candlestick trader will look for a bar confirmation which will prove that area for real is important.
Example:
A Good Looking Pinbar with 61.8 fib and a retrace into the trend.
What did i do which was different?
Hell I don't know i just had confidence in that area before bar confirmation,because i have faith in my methodology that at the right area if i have confluence i am sure price will bounce,thats it.
While a PA trader or bar trader is little bit conservative to look for confirmation, about the validity of the zone.
What is the similarity ?
I believe in confluence
He also does but will not make a move unless market tips its hand.
We both believe in Support and Resistance,but we also know that,not all support and resistances are created equal.
So Now you ask me how are we safe if he saw same things but in fact an extra thing,but we only saw a few without bar confirmation.
You are wrong there are some more things a touch trader will line up in his favor before taking a trade.
Trendline,With Trend trade,fibs,fib tools, PPZ, and even some Volume analysis, and some reasoning.
This all i did before the trade took place there,then on this i laid down my faith and placed a trade.
So where to go now?
We make this thread a ground to learn the most intricate and simplest things about S/R or PPZ which could tip things in our favor.
The Most important thing is Faith in the analysis you did.
Chart: