DislikedCan you please show a complete trade? In the graph, including the SL and PT.Ignored
In the pic below there are two charts. The one on the left is H1. The trade was triggered with a nice clean cross while the price action was still in the HAC. Stop loss would be placed beneath the low.
A few hours later, an H4 trade was triggered, only this time the cross was of a different type. It crossed above 20 as the HAC was being penetrated by the price.
When trades trigger in rapid succession like this, it makes them particularly strong, especially when the RAC is just coming out of 20 for longs and down from 80 for shorts. Also (I didn't show this), if you check when M15 had a trigger, you'd see that it happened just before the H1 triggered. When M15 triggered, M5 had just triggered, etc...
Initial stops are always beneath the prior high or low. They do not have to be hit, but it's wise, I think, to calculate the risk in this way. If the trade isn't going to work out (this is especially true when you're playing higher TFs like H1 & H4), an M15-M1 series will set up the other way and you should close the original trade and reverse. That way you can make some money after taking a small loss on your original position.
Trades are officially closed when:
1. They have hit a 3x level
2. They have their stops taken out
Until one of those events occurs, the trade is still considered active and will have an influence on the overall market action. Moreover, multiple trades can be active. Even trades going the opposite way can be active (which happens in consolidating markets - like in the GBPAUD lately).
As far as profit targets go, as in the example below, the swing low to the HAC line is where you draw the "collective risk" area (see a prior post #74 for this explanation). I set my fibs in even increments - 1:1, 2:1, 3:1 and so on because that's how human beings think when it comes to taking profits. They do this collectively.
3x, especially on an H4 chart, is where I consider the trade to be ended. It's rare that it goes further than that. On H1, the PT can hit 4x (see second pic). Oftentimes, the 4x on H1 is equal to the 3x on H4 (as in this example).
Does this help?
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