Entry is similar to MPB. Once price stalls on a return to an engulfed area I start placing pending orders above the high of the last closed daily candle for a long and vice versa for a short. Initially I place the stop loss at the opposite end of the candle. Order of the trade is as follows:
1. Price is rejected in a s/d zone (although if price moves through the zone then this can be played)
2. After the rejection price engulfs north or south (Often there is consolidation or flag that gets engulfed) This reveals big money's intentions.
3. Price will move back to the area of the engulf. Since I only watch daily candles I wait for the candles to show the way. Once there is weakness I move.
4. Place sell stops for shorts and buy stops for longs.
If you look at the two recent trades I'm in now look at where the orders are.
AUDUSD has engulfed south in a big way. I am now waiting for price to move back up where price engulfed south. Price may move down a bit still and it may take several days for the retrace.
1. Price is rejected in a s/d zone (although if price moves through the zone then this can be played)
2. After the rejection price engulfs north or south (Often there is consolidation or flag that gets engulfed) This reveals big money's intentions.
3. Price will move back to the area of the engulf. Since I only watch daily candles I wait for the candles to show the way. Once there is weakness I move.
4. Place sell stops for shorts and buy stops for longs.
If you look at the two recent trades I'm in now look at where the orders are.
AUDUSD has engulfed south in a big way. I am now waiting for price to move back up where price engulfed south. Price may move down a bit still and it may take several days for the retrace.