Before starting, I want to clarify that this doesn't mean "I'm short" this means: "I don't know what the price may do next; however if the price makes THIS sequence of patterns that I have defined in advance, I may be in front of a good situation to trade." WHY? Because I had tested this pattern in the past, both through real trading and backtests, and overall, I have a statistical advantage. Therefore I should trade it. (That's the logic)
Ok, let's start:
* The price has broken the ascending trendline on a -12% movement, and now we saw a bounce, and the price is close to reaching the main trendline of the current bearish movement.
* This is relevant because the price is close to the main level of the current bearish trend (the descending trendline). IF the price breaks it, we should start thinking about a flat correction with that bottom defined or a new bullish impulse starting. However, IF the price starts falling again, the bearish trend may continue.
*IF the bearish trend continues, I'm waiting for a breakout of the current yellow structure. When I mean a breakout, I want to see the price breaking it at least a little bit.
*IF that happens, I will be waiting for a movement, as you can see on the template, and I will trade in the same way explained there. With a break-even at 4145.00 (this means that I will move my stop loss to the entry level)
These are the 4 possible scenarios:
1) I never trade because the setup is never executed
2) I trade and I'm stopped out (-3% of my capital)
3) I trade and is a break-even ( 0%)
4) I trade and is take profit (+6% of my capital)
Thanks for reading!
Ok, let's start:
* The price has broken the ascending trendline on a -12% movement, and now we saw a bounce, and the price is close to reaching the main trendline of the current bearish movement.
* This is relevant because the price is close to the main level of the current bearish trend (the descending trendline). IF the price breaks it, we should start thinking about a flat correction with that bottom defined or a new bullish impulse starting. However, IF the price starts falling again, the bearish trend may continue.
*IF the bearish trend continues, I'm waiting for a breakout of the current yellow structure. When I mean a breakout, I want to see the price breaking it at least a little bit.
*IF that happens, I will be waiting for a movement, as you can see on the template, and I will trade in the same way explained there. With a break-even at 4145.00 (this means that I will move my stop loss to the entry level)
These are the 4 possible scenarios:
1) I never trade because the setup is never executed
2) I trade and I'm stopped out (-3% of my capital)
3) I trade and is a break-even ( 0%)
4) I trade and is take profit (+6% of my capital)
Thanks for reading!
