It’s been a long day so not sure if i’ve got myself all tangled up by over thinking
What i was wondering is, can i place an order to buy say GBP/USD @ 1.2350 then place a trade to go long and short i.e. cover myself in the event the price went up or down?
i.e. set a “buy stop” @ 1.2400 and “sell stop” at 1.2300
this way, depending on market price conditions only one of the orders would get triggered and i could cancel the other (unless i used an OCO order)?
wouldn’t this be a way to gain 50 pips for example either way, provided the price reached that price…?
This is not a bad idea, but you might end up not profiting from the trade because just when you end one of the trades, the open trade might even go wrong.
This is bracket trading and as long as certain conditions are applied it makes money.
You have to set the orders far enough apart that a move upwards or downwards is probably going to be a break-out, not just market volatility.
You definitely don’t want both orders to be triggered, assuming your broker allows this - both could be loss-making, increasing your risk.
Although chart patterns normally provide the TA by which the TP level is identified, in bracket trading at least one of the TP’s is usually based on the r:r ratio rather than price action features. It needs to be far enough out to justify the risk but not so far that price has a chance to revert back towards entry, and maybe even into negative territory.
