ETH on the 4h starting to put work in on the right shoulder of a Head and Shoulders pattern.
With a breakdown of the neckline target would be 1.1k-1.2k
The head and shoulders patterns are statistically one the most accurate of the price action patterns, reaching their projected target almost 85% of the time once break out is confirmed.
It would take an extra 1% but given previous wicks into the Demand Zone I would wait for body confirmation below below the demand zone to help eliminate extra fake outs.
I moved a projected entry to 1530 but where you enter and place stop loss would be determined by your own risk.
Typical stop loss options:
1. Break above right shoulder
2. Above most recent swing high
3. 3% above neckline.
Safe trading and leave your thoughts/pointers in the comments 👇🏻👇🏻👇🏻
With a breakdown of the neckline target would be 1.1k-1.2k
The head and shoulders patterns are statistically one the most accurate of the price action patterns, reaching their projected target almost 85% of the time once break out is confirmed.
It would take an extra 1% but given previous wicks into the Demand Zone I would wait for body confirmation below below the demand zone to help eliminate extra fake outs.
I moved a projected entry to 1530 but where you enter and place stop loss would be determined by your own risk.
Typical stop loss options:
1. Break above right shoulder
2. Above most recent swing high
3. 3% above neckline.
Safe trading and leave your thoughts/pointers in the comments 👇🏻👇🏻👇🏻
Comment:
Trade officially confirmed. Follow your strategy and manage your risk. Never trade with out a stop loss or recording in your trading journal. :)
Trade active:
After a solid confirmation followed up by a 6% dip, ETH along with most of the market has seen a decent bounce. ETH bounced around 7-8%.
I expect 1550 to act as resistance which you can see in my first 2 charts. We could see some deviation or overthrow. In the chart below I have added two other down trend lines. Should we break 1550 I will be looking to increase my position even larger above 1600
That leaves us with 2 options. Move the stop loss up roughly 2 more percent should ETH break 1550 and test 1600-1610 so the trade stays active.
Or leave the current stop loss, get stopped out above 1580, see how ETH acts if it hits 1600 and re-enter from there. Either option is ok in my opinion and still leaves a very nice reward for the amount of risk in this situation.
Personally I am leaving my stop loss and risking getting stopped out because price action could barrel 1600 and climb all the way back up to the right shoulder and close just below the swing high with out invalidating the pattern.
I expect 1550 to act as resistance which you can see in my first 2 charts. We could see some deviation or overthrow. In the chart below I have added two other down trend lines. Should we break 1550 I will be looking to increase my position even larger above 1600
That leaves us with 2 options. Move the stop loss up roughly 2 more percent should ETH break 1550 and test 1600-1610 so the trade stays active.
Or leave the current stop loss, get stopped out above 1580, see how ETH acts if it hits 1600 and re-enter from there. Either option is ok in my opinion and still leaves a very nice reward for the amount of risk in this situation.
Personally I am leaving my stop loss and risking getting stopped out because price action could barrel 1600 and climb all the way back up to the right shoulder and close just below the swing high with out invalidating the pattern.
Trade closed: stop reached:
My trade was stopped out just by 1% and that is ok. Price action did almost exactly as expected (or we thought) by getting rejected at 1605 but minimizing/managing risk will make you more money in the long run than "being right" from time to time.
Moments like these are very critical for honest review and journal entries and a normal part of the journey so dont get discouraged if a stop loss is triggered.
For honest review always ask your self questions like this:
Was my stop loss too tight?
Did I force the trade because I wanted action?
Am I being honest or results orientated?
Upon confirmation of the current 4 hour candle (literally hovering at original entry price) I will be re-entering the trade as its likely the squiggly line will rule all. ;)
Moments like these are very critical for honest review and journal entries and a normal part of the journey so dont get discouraged if a stop loss is triggered.
For honest review always ask your self questions like this:
Was my stop loss too tight?
Did I force the trade because I wanted action?
Am I being honest or results orientated?
Upon confirmation of the current 4 hour candle (literally hovering at original entry price) I will be re-entering the trade as its likely the squiggly line will rule all. ;)