Trading is similar to investigative work. At this point and time, I do not know the high is formed or not
but it's ok since I trade pull backs and I want to illustrate how I use various perspective to gather
evidence to substantiate a trade.
So, if the current high is at 1.2082, what I'd do is to wait for Euro to pullback to the zone highlighted in
Blue. I am willing to take a trade because
A) Risk to reward is in my favor
B) This blue zone will hold if the evidence point conclusively to long
C) I do not have to guess where the breakout ends and is not stress
It works for me because I have time to build my trade plan, knowing the risk to reward is in my favor,
and of course your own statistics of win/loss ratio that it becomes "easy to manage". I may still get
it wrong after waiting but the result of this trade itself does not determine the long term outcome of
your equity curve. As long you adopt certain mindset that winning and losing is part of the game, you
are ahead of the game.
Comment:
I am ready to long Euro if a higher low lower high candle is formed.