Db, You are showing good potential to become an EOD trader. Let me know if you are looking for an internship. Gringo
Now as we approach the trendline, we look for a climactic low. That trumps whatever lines one may have drawn. The market will tell us what to do.
Well, it became clear to me years ago that few of those who claimed to be daytrading really were. They might be closing their trades before the end of the session, but there's a lot more to daytrading than that. For one thing, you have to be watching price move. So, perhaps by using hourly charts, I can show that the same principles apply and the same approach, and by plotting a bar interval one can actually watch, even at work, he can (a) learn how to trade and (b) make money while doing so.
Hello there, Why don't you suggest exiting the short at the break of the second supply line with around 10pts profit? As for me, it seems to be a strong reversal movement although it didn't even reach the 50% yet.
One could exit at the break of the first supply line if that's in the plan. The idea is to show how to read price, and not specifically how each entry and exit 'should' be. Usually those who have more patience, experience, or higher risk tolerance tend to give price a bit more room. Keep also in mind that it doesn't have to be 100% entry or 100% exit all at once. One can as an example exit 20% at the break of the first SL, another 20% at the break of second SL, 20% when a previous swing point is breached etc. This is where the plan comes in and some testing of what a person prefers and is comfortable with. Gringo
It's also a question of how fearful one is and how many contracts he's trading. If he's fearful, he's likely trading only one or two contracts, most likely one. In that case, he's looking for reasons to exit, to cut his profits short, so he'll be exiting and re-entering and exiting and re-entering and so on, assuming he re-enters at all. The confident trader, on the other hand, will be trading greater size and he'll be looking for reasons to stay in, not to get out. So it really depends on where you are. This is not to say that one gains confidence solely by behaving that way. It's a process, and one reaches the goal by repeated practice, assuming that one learns from the practice. Many people don't.
Incidentally, it's not unexpected to find a lot of back-and-fill this close to the trendline. If one just can't stand it, he can always take the money and run. 60pts isn't shabby.