[tymen1]

Chart 10 >>>


By tymen1 at 2008-10-13

Now what???

The entry line has become a dashed line!!

Yes, the PCI stop loss has been shifted directly on top of the entry line.

You can see that this is so by looking at the left of the chart where you will see 2 tags to the line - one red and one blue.

The blue tag is the entry line and the red is the PCI.

I now quote from my 4 Levels "COMMON PROCEDURES AT ALL LEVELS"

The 2 amounts strategy works as follows :

1) Firstly, we get one small profit from the 1st amount.

2) The stop loss or trade closure is now moved to the trade entry point. (Break Even).
The 2nd amount has a much larger profit target, but at worst, it would retrace to the trade entry point, giving a profit/loss of zero for this amount.

3) Therefore, at worst, we have the 1st amount profit only, but this is superior to a loss.

Or, if you like, the same quote from the original post regarding multiple amounts.
It says it in more eloquent language than I can use........

Therefore, when the first lot meets its first objective, the second lot’s stop is moved up to break even which locks in the gain and guarantees that profit.

When the first target has been met, the worst that can happen from that point on is the second lot retraces to the breakeven point and the trade is closed out for the net profit on the first lot.

We now concentrate on the 2nd amount.