Credit to myself for taking such a "risky" pattern.
I know that the only way to realize the true potential of this methodology is to not filter out anything and let the method speak for itself- In my experience the merits of the setup, that is, the probability you give it of working or not based on your analysis, holds less importance than what you do when you're in the trade.
Working on creating the habit of trading based on pattern entry and pattern stop regardless of whether I managed to attain that entry or not.
The edge which created itself during my time learning this method, dictates that I exit after momentum stalls into minor S/R. If I've timed my entry well and placed the stop where it visually belongs on the pattern, I almost always return more than my risk. Unless, of course, it flat out fails from the start (ie momentum slowed then took off again in the same direction).
The three elements- stop, entry and exit (if not stopped out) need to work together. Deliberately skewing the R vs R by placing a stop above wicks instead of above the pattern (for a short) then exiting based on the pattern (as I did in this trade) won't do any good in the long run as far as profit is concerned.
What it does do is strengthen discipline and removes ego from the above equation.
1 comment:
It would be interesting (a phrase I often use and others disagree!) to look at your profit/loss broken down by pair.
You are trading some wide spreads and the benefit of additional set-ups may not (or may) be worth it.
Only the numbers will tell!
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