Place a more aggressive stop-loss order to take a larger Forex trading position size

Taking a tighter stop loss so you can take a larger position size and then you mitigate the risk of the trade turning against you um and stopping nicely so let’s take a look at this live in the market, this is nzdusd and so you see that this setup even with the conservative approach achieves 26.7 P Yes, it was done conservatively, so if you know you know how to get in early like back here at the 4 hour support level.

Place a more aggressive stop-loss order to take a larger Forex trading position size

You could have had more movement in the market but 256 pips are nothing to sneeze at so you have the double bottom formation the way I show you how to trade is the conservative approach you wait until the resistance level hits the 4-hour level so you’ll wait At this 4-hour level, you will wait at this 4-hour level until the price breaks through and you see that the price has returned and tested this area, then go from there.

And this is what I measured as the potential profit on this play that you would have entered the breakout on a retest of this support level over 4 hours. Now remember I said that if you were taking this on a lower time frame you would want to stop loss tighter and so what I did was I placed my stop loss at the last swing low so I don’t have that range of stop loss or potential risk on the table.

Take profit at a certain level in Forex

The take profit is at the level where this formation starts well, so this is the double bottom live in the market on NZDUSD the next day The formation that we are going to look at is the head and shoulders reversal pattern, which is a bullish reversal pattern and we usually see it at the end of a downtrend, so What you will notice is that what distinguishes this formation is that it looks like a head and shoulders. You have three peaks, where the central peak is the lowest, then the peak to the left and right slightly above it.

The key feature to remember in this setup is that you will have a resistance level between the left end and the right end which you will have at the neckline, I must say that between the left shoulder and the right shoulder, you will have a level of resistance and therefore what you will have is a drop in price through A key level, then the price returns to retest this level, rejects and declines further.

Forex resistance level between left and right end

The resistance level between the left end and the right end goes up and tests this line and then breaks the low and then oftentimes you will have the price come back to retest this level and this entry point is correct and so it can be traded before the neckline or as I like to do, I like to take a more aggressive approach and maybe I’m going to go in here because what I’m seeing I’m seeing b c then d right once you know how to use FIB, you can use it with these chart patterns so you can do more aggressive trades and get more pips on the table so I went over this right once Other.

And this is the conservative approach that I take I’m explaining to you that if you take your entry point at the break uh, you’re going to plan to take profit at the beginning of the formation, and you’re going to put your stop loss under the last low but I highly encourage you as you learn more about this to learn how to go to the time frames. Less and be able to get a tighter stop loss so you can reduce your risk.

You will have to take a small position in a Forex trade

You still want enough room for the trade to breathe but that’s not going to happen on our 4 daily you’re not going to be able to do that because you’re going to have to take such a small position so you’re going to have to learn how to drill down and get below that last bottom and put a stop loss so let’s see This is life in the market see this on the individual US dollar, this is an inverted head and shoulders game.

So you see that the movement if you follow my mouse cursor here, you’ll see that the movement starts at the blue indicator and we start to go down we find the monthly level of support and then we go up and we find this neckline right, we find the price of this neckline pulls back and forms a lower low and then it starts to go up from there There is not enough momentum yet and then it pushes back into this monthly area and then we see that the price moves and completes at the level where the price started.

So I put the FIB here so you can all see how it’s executed correctly, so the FIB that this move was based on is here, you have your low you have your B high, you have your C pullback, and then you see here at this right tip, you see that the price It tells you that you can move this to this daily resistance level so you can base the trade on just this FIB.

Start building and making profits in Forex

Knowing that you have this price can advance to where the formation starts, you can take it a little bit further now on the table really when you know how to enter the trade if you go long at this point you’ll know hey I’ve got 4115 pips on the table.

I know I can take this back to where the formation started and take profits or you can be more conservative and take it to the active Fibonacci sequence extension which would have gotten you 25.6 pips, this is the inverted head and shoulders, okay, let’s look at the final diagonal now, This is based on Elliott Wave Theory.