If you did not catch the trade from the completion of the pattern, the market is painting a beautiful head and shoulder that can provide a nice entry risk/reward. As usual, you would need to wait a bit for candle to confirm a further mover upwards. stop loss can be placed below at the D leg of the pattern but, i would rather place my stop just above the D leg at the close and open to maximize gains upward. whether your stop loss is just above the D or at the d point does not matter. If you are practicing proper money management, the amount loss will be the same, the difference will be reflected in the amount gain.
For example if you have a 10,000$ account and your rule per trade is 5%. (using this trade as an example) it means you are going to lose $500 on this trade (not that i'd use 5% on this trade 1% tops). Your stop loss below point D is about 13 pips while stop loss Above D is 7 pips. 1. Stop loss 13 pips) means that you'd divide 500/13= 38.46$per pip x 20 (pips gain if target is met) which give you $769.23 in profit. Now with the other 7 pip stop loss 500/7 = 71.43 x 20 = $1428.57 which is almost twice as much.
there is a downside to this strategy. Having a larger stop loss gives more room for play, while a tighter stop loss can easily be triggered by high volatility. but for this trade, i wouldn't worry so much since a move past the close with volatility will most likely stop out both stops. but as always as a human being, i could be wrong. let see how it plays out.
For example if you have a 10,000$ account and your rule per trade is 5%. (using this trade as an example) it means you are going to lose $500 on this trade (not that i'd use 5% on this trade 1% tops). Your stop loss below point D is about 13 pips while stop loss Above D is 7 pips. 1. Stop loss 13 pips) means that you'd divide 500/13= 38.46$per pip x 20 (pips gain if target is met) which give you $769.23 in profit. Now with the other 7 pip stop loss 500/7 = 71.43 x 20 = $1428.57 which is almost twice as much.
there is a downside to this strategy. Having a larger stop loss gives more room for play, while a tighter stop loss can easily be triggered by high volatility. but for this trade, i wouldn't worry so much since a move past the close with volatility will most likely stop out both stops. but as always as a human being, i could be wrong. let see how it plays out.