Tips for Entering the market (2)

Set the entry to avoid a stop loss exposed earlier

Another advantage of the optimal entry is to prevent stop loss which we have specified exposed earlier. We shouldn't rush in so look there is signal, but instead wait for the right entry level after we know the direction the market sentiment on the next bar. In this case we can place stop loss at the level of the most secure without changing the adjustment is predetermined based on our risk. With the possibility of terhindarnya stop loss exposed early, then the probability of profit we will get will be even greater.

In our example USD/JPY daily trading signals above, occurs after the pin bar formed a price above the highest level of unveiling the inside bar (point 1). How a raw entry is usually on level after closing pin bar (after the bar is convinced that it is true pin bar) in point 2, with a stop loss at the level of the lowest usually pin bar (point 3). As shown in the picture, three days later, the stop loss is hit before the price soar the next day.

If we went after know roughly where the sentiment of the market, then we would have entry level lower than previous examples (we'll buy, and certainly will go on a level that is as low as possible), usually at 50% of the pin bar (50% retrace). In the example above happen inside the bar after bar pin that shows consolidation, but with the trend bullish. With entry on roughly half the level of a pin bar (50% retrace entry), then the stop loss simply shifted to the bottom without changing the adjustment. From the movement of the market then we can earn a profit even with the risk/reward ratio of 1: 2.

Another example on the daily chart of XAU/USD above. Many traders are on the highest level or entry level closing pin bar because it might be afraid to miss the market. Stop loss is usually determined at approximately the level of the lowest pin bar (area A). As shown in the picture above, a lot of the team in the area a. Is when one entry at level 50% retrace of the pin bar, with a stop loss of quantity remains the same we can still profit by up to 3 times the magnitude of the risk (the risk/reward ratio of 1: 3).

Conclusion in order to use this type of entry tips:

1. the decision taken only if the entry form is a pretty bar pin signals are valid on daily time frame

2. wait until the pin bar finish is formed (the next day)

3. Entry at level 50% retracement of the pin bar (50% retrace entry)

4. specify the length of stop loss pin bar (SL = highest level of lowest-level bar pin pin bar)

Posted by Unknown on Tuesday, February 3, 2015 - Rating: 4.5

Title : Tips for Entering the market (2)
Description : Set the entry to avoid a stop loss exposed earlier Another advantage of the optimal entry is to prevent stop loss which we have specified ...

Tweet