formulate a trade idea – your analysis, a likely possibility // set-up play out
Same analysis as T17 – re-entering as the first execution was terrible. Idea is still valid. Price bouncing off an area of resistance with an ABC corrective wave, that wave is now over (broken TL + SMA cross) and a sell setup has formed on the 1H.
trigger for the mentioned idea, what you want to see: clean impulse + choppy correction
Structure has changed with support becoming resistance and 50/100SMA confirming and providing the TAZ. This is complimented with the additional confluence of stochastic coming out of the oversold region as it does with the TAZ. Likely to be on the correct wave cycle this time instead of T17.
TREND on entry timeframe & 4H chart, determined by SMA if subjective (✓)
IMPULSE registering ADX>25 (✓) ADX26
COIL structure clear formation relative to prior impulse (✓)
Flag // Rectangle // Pennant // Wedge // Triangle // Diamond
Fibonacci 50%–61.8% // S&R Level // Trend Line // Moving Average
Simple // ABC // ABCDE // Extended Combo
Entry @ Break of Structure // Area of Value + Candlesticks
Stop Loss @ +1ATR away from last wick // Before Impulse Start
Take Profit @ Length of Prior Impulse // Next Area of Value
1% capital risked for potentially 2.6R
Entry: 0.993 | Stop loss: 1.00 (-60 points) | Take Profit: 0.9773 (+157 points)
If running >1R + swing established, risk halved
If 20% left to take profit, shift to break even
If strong momentum + space to run + aligned with long term view, extend take profit and use trailing stop
Remarks: Yes that was a valid sell setup initially. But management was not there. After the sell setup played out, there was very little selling pressure and it started to form a longer term buy setup – you saw that but did not do anything about it. At least stop loss should have been halved above the swing high or shifted to breakeven after the bearish engulfing at the entry point.