Picking up where we left off last week...nice and simple makes money.
1.) What did I see?
A gap down and first two bars were wide-range. Note that even though both bars were weak, they pulled back from the lows before closing, leaving a long lower tail/wick (a bullish sign). The third bar is a hammer (as close to perfect as you can get), and it closes above the opening range low set by the first bar (in other words, support).
2.) What is the entry?
A break of the third bar high.
3.) What is the exit?
The target was the retracement zone from the previous day's high to the opening range low. It was hit two bars later. I usually close 1/2 after $1, but held and closed the entire position when the target was hit (more money, but lack of discipline?).
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