Its an interesting point. Ive been asking myself the same question lately.
The trouble is, if you take full profit at 25-30 pips, essentially scalping, you need really tight stops to get a risk reward ratio of at least 2:1. I dont think entering at NYO with a ten pip stop loss would really work out. I get stopped out easy enough with a 30 pip stop loss
Maybe if you figured out the direction for the day, let the NYO get underway and then wait for a pause in the trend, maybe when a STL is forming. But then were getting away from fibs and OTEās low risk high probability set ups, the back bone of the thread.
But I think as follows when I make a trade with three lots (so that I can scale out according to the advice):
If this goes against me right away, I lose 3 x 25 pips = $75 loss.
2a. If it goes positive 25 pips, I take one lot off, and accept breakeven on the other two, I make only $25-30.
2b. If it goes positive 25 pips, I can bail out with $75 profit.
If all goes well, I can make 25 + 50 + 75, say, for a total of $150.
The way to decide which tactic is best, over the long run, is to look at how many of your trades fall into types 1, 2,and 3. Well, for me, 3 has proven as rare as henās teeth, and when it has happened, it has not been without big moves backwards at times, so I am setting my sights on type 2. And for type 2, the best tactic is 2b.
Even then, there are often times when price turns around before it gets to 25-30 pips and I see profit being handed back, so I bail out earlier anyway, often justifiably, in retrospect.
I am not saying this is advisable at all, by the way, itās just how I seem to be doing things at this stage.
I was thinking about this as well tonight. I plotted out the H/L for the last several days for Cable on a 1h chart, and it looks like we can have are sights pointed at an OTE buy when the cable crosses 5720 - 5700 (a fig) with prior London and Asian support. Is this what you mean.
Thanks for your replies guys. I think the hardest thing for me to determine is the daily trend. I feel like if I could get better at that it would have a huge impact on my consistency. So how do you determine the trend on higher time frames? I feel like when I look at the daily chart Iām kind of limited. I look at obvious S/R levels, and I draw fibs and look for OTEs which might signal a change in direction, but other than that, I donāt really know how to determine where price will change direction on the higher TFs. Are you able to determine a change in the direction of price on the daily or weekly TFs without a significant S/R level or an OTE? Another question I have is where do you draw a S/R line on say the 15 minute or 1H chart? Do you do it at the top of the body, or the top of the wick. I know there were some videos where ICT addressed it, but I seem to see both done on the videos. If the wick is 10-15 pips or less and I see a few bodies of candles lining up, Iāll focus on the body, but when I see a swing low with a 20-40 pip wick, I feel like that needs to be taken into accountā¦where do you guys draw the line?
And on a side note, this forum rocks! I donāt think I would have a shot at becoming successful trading forex without it. You all are so helpful, and Michael, Iām still amazed at how generous you are and how much time and energy you have given to helping us all. I DO feel lucky that Iām starting with your techniques so I donāt have to worry about breaking old bad habits from other trading methods. So a big thanks to everyone!
Scaling in, I donāt really like it. If all positions go against you you hit maximum drawdown, if your first position goes your way you limit your profit, is how I see it. Identify your OTE zone and find the best local S/R within it. If you think the probabilites are high enough to enter near the 62%, do it and adjust your position size accordingly.
I use the top of wicks to draw my S/R as it only takes a wick to trigger pending orders, breach levels etc. and a wick on one TF may be a body on the next.
The market has been a bit trendy of late so identifing the direction shouldnāt be too hard but we expect price to range, in general terms, maybe 75% of the time. When the market is ranging up the priority given to TT and pivot buy/sell zones. When trending up the priority of MF but remember S/R trumps the lot.
You know I havenāt been on here much over the last few weeks, due to other commitments & been on the road.
Really enjoyed the thread & videos, so much effort & thought put in here & I admit I havenāt been able to contribute much, sorry.
My head is been ādone inā in a rather unique way with this whole decision to spend the next winter going live with a small account in order to come to serious grips with this whole thing, but something sort of bizarre has happened here, as I got back to NZ on Monday & woke up Tuesday & checked the news on line as I usually do, to be astonished to learn that the only successful forex trader I knew in real life (who is a great guy & very intelligent too) is been investigated by the Serious Fraud Office after apparently turning himself inā¦
He is related to me so of course there is quite a fuss going on in our family circles & as a number of my folk know of my intent with forex itās become quite awkward for me mentallyā¦
On the one side there is the likes of the above which is like a beacon of financial hope, while on the other my rellies are starting to look down their noses at me like Iām some sort of moron for even thinking thereās anything valid in forex trading having seen someone just lose mega dollars of not just his own but his clients money, as well as ending up with possible fraud charges to boot!
Iāve put a lot of my time into this so far, made my plans & booked my ticketsā¦ & now even Iām wondering if itās just an illusion, Iām not saying it is but when you have something so real staring you in the face & the other side of the story is only on line itās rather intimidating if you can imagine itā¦ donāt want to discourage youās to the contrary Iām trying to talk out my fears so they can be rationalized & put into perspective.
Keep on trading folks!
It was indeed an ICT classic! Daily support, market structure low anticipated, OTE within OTE, market flow bullish in the buy zone GMT S1 lay directly on 5700, PDL, session lowā¦the only thing we didnāt get was TT but was willing to ignore that with the other confluences. Double Tap TP2 at 5800 because of resistance, market structure, reverse OTE.
[B]My first attempt at breaking my growing scalping habitā¦[/B]
GBP/USD, entered at 1.57147 at 6:18 GMT
Stop-loss at 1.56844 (30.3 pips)
Take-profit at 1.57456 (30.9 pips)
Reasons for:
No GBP or USD news until GMT 8:30
Market flow up on four-hour and daily, so OK
London open kill zone
Buy zone
Long-tailed hourly candle forming at GMT 6:00
61.8% OTE 1.57132 from Fibs drawn from Tuesdayās low at 1.56309 to yesterdayās high at 1.58464
Support from Wednesday low of 1.56993
Support from GMT pivot S1 at 1.5698
Support from round number 1.57
Support from old weekly low 1.57045
Support from old weekly high 1.57144
Market bias upward (I think?) since first week of October, general risk-tolerant environment now
COT commercials very long and Open Interest very high
Falling USDX over the last two weeks
Time of year: September-October annual rise in GBP/USD
Mild buy signals from Williams % R, RSI, Stochastics, and MACD
Almost 1.28 (1.22) ratio between recent major highs and lows
Reasons against:
Market flow down on hourly
A bit late to enter, and therefore slightly high in price and just outside the OTE zone
Traderās trinity no-manās land (but I find generally this tool little better than a distraction)
Not sure what to make of these ones:
SMT: it looks like the Euro and Pound are highly correlated right now
Treasury bond yields: 2-year failed to rise last week, unlike others
Progress:
I didnāt like the new low at 1.56922, below all 5 support lines! (22.5 pips down, at that point)
I moved the stop to breakeven 1.57150, prior to news time, with price at 1.57293 (14.6 pips up)
Stopped out in volatility one minute prior to news
News then took price to where my TP had sat! Had I not moved my stop, I would be out with 30.9 pips.
Disappointing; I feel I should have scalped my pips when I had them, like I used to.
[B]Second attempt (since I figured that most of the logic still held, news was positive for the GBP and no more news for three hours until 11:30 GMT, and Iād lost nothing so far)[/B]
Re-entered at 1.57141 at 8:32 GMT
Stop-loss at 1.56861 (28 pips)
Take-profit at 1.57505 (35.9 pips)
Progress:
9:28 GMT SL to 1.57355, took off 50% at 1.57410 (26.9 pips), TP moved further out to 1.57816
9:30 GMT price moving so fast I didnāt have time to adjust TP a second time, position closed at 1.57816, 65.5 pips
Point taken I did think of the ālimiting profitāā after I posted - and that is a solid enough reason for me ā Thanks for input guys- THanks PIPHanger for initially questioning it.
So I have another question - the other Bold part in the quote - what is TT?
Yup thanks Clark. Sorry about my grammer, it might confuse the issue. When I say up priority, I mean increase priority, not that the market is moving up. I need to be more careful, I can see how this could be misinterpreted. :29:
