In term of learning Forex, I use Trade Sim expert advisor to improve my sense of detecting candle stick pattern trading. Here I want to show you how the pin bar candle works perfectly. I use EURJPY on 17 July 2013 as the base. See the chart below for better visualization.
OK on the hourly EURJPY chart above I saw a nice pin bar candle with pretty long wick. On the next candle, the price break the low of the long wick candle. I open SELL immediately on the breakout.
Where is the target or exit point?
1:1 risk reward ratio is a good practice. Or, you can use the previous support for the target.
Where is the stop loss?
Stop loss ALWAYS put on the high of the long wick candle plus few pips to avoid “pip hunter” broker.
On the example above, 50 pips is secured.
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