DislikedHi Palmer and everyone, I have been following the thread for 4 months, still trying to learn. Two questions: When I take a MACD signal and if Stoploss over 50 pip, say 100, I modify my lot size according to my 2% of the capital. when sL is over 50, does the trade still a high probability trade (considering other system conditions are good, price action, market rhtym, market motion etc.).
second question: what are your SL, TP1 and TP2 strategies? How can you decide "TP1 area" and "TP2 time". Is TP1 planned before entry?
I can watch every 4h...Ignored
Just want to also add to Palmer's notes on profit targets. Profit targets also need to be discretionary and considered on every individual trade, based on a feel for the mode the market is in and from traders experience. This is why they are so complicated and nobody can say "I have studied GBPUSD for a year now and it is optimum to take profit after 30 pips on every TC".
Some hypothetical trades to illustrate this point
The market is consolidating in a triangle but you 'pick out' a TC within the triangle. The market has been whipsawing around lately, and you have a feeling this trade might be a little riskier than others. How do you manage this trade. You might only go for a quick small fixed target win of about 20-30 pips.
Then you get a TC signal with price breaking out of this emotional triangle it has been stuck in for the past four weeks. Would you manage the trade the same way and go for 20-30 pips?? Probably not, there is potential of leaving 100's of pips on the table. You will use a different 'play' and go for a bigger win, you should try and position yourself to ride the emotional trend and wait to manually close the trade based on trend stalling.
Now price is gently trending upwards and 'climbing the stairs' up. You get a gentle little TC. How do you manage this trade? Fib targets (as shown in my post above) are great for these types of trades.
And after the long drawn out 'climbing the stairs' trend upwards, price falls sharply, you go short on a TC signal. Price is emotional with tails to the top and you anticipate price to 'jump down the elevator shaft'. Would you manage this trade the same way?? No
I hope you get my point. Every trade will be different, and your TP's, SL and trade management should reflect his. With experience you will learn what 'play' to use on each trade. You will learn when to go for a bigger win. When to only go for 20-30 pips. When to go to BE as soon as possible etc. etc. Phillip has mastered this.
I hope this has helped.
The trend is your very wealthy friend