T8 – GOLD

IMPULSE – CORRECTION – IMPULSE

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ENTRY

Daily/4H/1H/30mins timeframe (select only 1)

[1] Price trailed by 30SMA – ensure strength of first impulse wave (✓)

[2] Pullback between 30SMA and 150SMA (✓)

[3] Corrective structure formation with 2×2 touches Pullback within S&R + Downward channel

[4] Stop order at the break of corrective structure with stop loss after swing L/H

[4] Stop order after price bounce off area of value with volatility stop (✓)

Additional confluences: Support or Resistance, ADX40, Linear Trend Lines, Fibonacci Retracement, ATR and Elliot Waves. +Downward Channel +Bearish Engulfing

1% capital risked for potentially 3.6R

Open: 1240 | Stop loss: 1270 (-30 points) | Take Profit: 1130 (+110 points)

Remarks: The HTF swing strategy could also have been feasible. What’s important is trading with the trend + from an area of value.

MANAGEMENT

Keying in the trade, use volatility stop placed under/above an established swing L/H or moving average cross or estimating volatility using ATR.

Real stop loss placed under/above the anticipated swing L/H using 150SMA as a guide.

Take profit calculated using the length of the prior impulse wave rounded off to next nearest swing point/key level.

Once entry triggered and break out, shift automated volatility stop to real stop position.

At 50% of 2nd impulse or a swing L/H established, shift stop to break even.

At about 80% of 2nd impulse, shift stop to the 50% mark or below/above swing L/H.

If price breaks and closes under/above the 30SMA, tighten stop loss and prepare for manual exit.

EXIT

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[1] Initial stop loss

[2] Trailing stop, as mentioned under management

[3] Manual exit due to change of momentum and break of market structure

[4] Take profit

Remarks: That was some wicking out. Perhaps, place the stop loss after a round number. Idea is still valid…

GOLD.pngA small shift of trend line and the wick is expected to be expected.

Look to re-enter the trade on 4H timeframe with the backing of 30/150SMA.

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