6.1.8.Family
Short

The Pattern Trader Dilemma

FX:EURUSD   Euro Fx/U.S. Dollar
Stalking this trade made me remember the lectures I attended few months ago as a fresher. Maybe it might not be directly linked but lets just say I turned the idea of a prisoner dilemma to the Pattern Trader Dilemma.

Woke up feeling great, knowing that I'm about to continue my grind, and given today is Monday I wasn't expecting a busy day.As I was analysing the EURUSD             chart, I saw three potential bearish patterns forming, AB=CD pattern ( in the dashed lines), Gartley Pattern ( Blue-violet colour ) and Bat pattern ( Sea-blue colour ). Knowing trading is about probabilities, I asked myself what if all these trades turns out as losers? I'm I willing to eat all these losers? Which one should I take? There goes the Pattern Trader Dilemma.

After few minutes of analysis, I decided to take take the Gartley pattern . I'm expecting a deeper CD leg of the Gartley which will increase the risk : reward on this trade. WHY THE GARTLEY? Although the AB=CD would be valid, in order to be safe, my stops will have to be at the same place as the Gartley , hence the pay-off on this trade would not be favourable. But I was interested in the Gartley because it came into the zone I would be interested in taking a short position. And given its deeper CD leg, the pay-off would be great.

What about the Bat? Usually, I would go for the Bat, however, since it's not in the zone, I am prepared to eat the loss on this Gartley and on the Bat, if they are losers.
Spitfirefx
2 years ago
another thing to note is that the gartley aligns correctly to the upper trend line of the daily channel.

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6.1.8.Family Spitfirefx
2 years ago
Great idea, it seems I'm not on my own stalking this trade
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