Selling opportunity due to a bearish Cypher pattern. I placed a sell limit at 1.1741 for a more conservative entry, instead of the usual entry at D completion. This is due to my understanding of market psychology, but I digress. Stop loss goes above X while my initial target was 50 pips, giving me a decent risk/reward of 2.
Months and months of studying market psychology have not failed me as my sell limit was triggered to the pip. A perfect entry. What more could I possibly ask for? Having had a perfect entry, I extended my target all the way back down to the C leg. A grand total of 120 pips and 4.8R was taken from this trade.
I’ve always had a bad habit of losing my first trade of the week but this…..was a pleasant surprise.
I identified a selling opportunity due to a potential zone of reversal (orange box), in confluence with the top of a bearish channel. The plan was to wait for price to go past my entry before setting a sell stop at 0.67877. My stop loss went above the zone and target was the bottom of the bearish channel, giving me good risk/reward of 2.8.
Price did trigger my sell stop and was ranging around my entry before I was eventually stopped out in one candle. No better way to know that you’re wrong. I was stopped out for a 25 pip and 1R loss.
In hindsight, if I had actually used the zone of reversal as a turning point, I would not have taken part in this trade, therefore saving me a loss.
This was a buying opportunity due to a demand zone (green box). The plan was to wait for price enter the zone before setting a buy stop at 1.32518, with my stop loss below the demand zone and my target being 65 pips. This gave me a decent risk/reward of 2.5.
The setup was triggered but price dropped quickly, stopping me out for a 30 pip and 1R loss. In hindsight, in the first image, price was actually at resistance and could not make a higher high, signifying the end of its short uptrend.
Price was at previous resistance, which could potentially turn to support, giving me a buying opportunity. A placed a buy stop at 0.99908 with a 25 pip stop loss and I was targeting 60 pips. This gave me a decent risk/reward of 2.4.
Price went down a lot more before reversing and triggering my buy stop. I was about 15 pips away from TP before priced retraced towards my entry, and this was when I moved my stop loss to breakeven. Thereafter, my stop loss was trailed based on price action.
I was unfortunately stopped out for a profit 35 pips and 1.4R. In hindsight, if I had a more conservative entry, my target would have been hit easily. A more conservative entry would have been near where price reversed as there was some support in that area.