I tried looking up the data for IF's very first example on this thread. As the data appeared slightly different on my testing software, I have ended up re-imagining that scenario, using my current understanding of flag limits etc. The first engulf ...

Something like this:

Here's my hindsight take on GBPJPY around that time. Not sure how valid this is:

Hi libracat. This is how I see the FL for the break of the high you are looking at: The FL should always be at the point where the high got broken. If you can't see a kink that covers the line you've drawn from the high, then you must use the entire ...

Although there was indeed a swing low here, libracat, I think what we need to see is an engulf that is a reaction to a higher TF zone, rather than just a lower low in any situation. In this case, the lower low appears to have reached a lower zone as ...

If it makes you feel any better, libracat, the engulf didn't even happen on my Tickmill Demo chart.

@BeefStew - I appreciate your posts. Good stuff. In this case I don't see the same engulf that you did at the time, so maybe something is amiss and this explains why the sell trade did not pan out that time.

@fx-slaver Am I right in thinking that your buy zone is at the kink of where this significant level was broken upwards?