I’m doing demos on the daily time frame, and place buy or sell stop orders on all my trades. One thing I’m trying to get a handle on is how far ahead of the setup candle I should I place my entry. Lots of traders say “a few pips,” but that’s not good enough for me. I don’t like being sloppy. I love quantification.
I know that entry placement will vary, perhaps among other factors, with the ATR, which itself varies from time to time and pair to pair; but if someone can help me quantify a reasonable distance ahead of the setup candle, or at least provide a rule of thumb, I’d appreciate it. I don’t want to get so far ahead of the setup candle that I’d lose too many pips, but neither do I want it to be so close to the candle to not serve its purpose, which is to demonstrate momentum in the direction I hope that price will take.
Any clarification would be great.