Let’s explore several subtle aspect of the breakdown retest setup we looked at yesterday, and I’m going to show you how it can get better entries than you were expecting.
If you missed the email yesterday you can catch up on blog.scottphillipstrading.com , which is new. (I’m going to try and post these emails for posterity there)
When I sent the email yesterday with the setup in, it looked like this
But that setup never filled.
What to do? Our system rules (from the System Building Masterclass) tell us to replace the buy order one tick below the low of the next bar, which is 2 measly pips better.
Why do this? Well, the real reason is that if the market keeps going up too much we probably don’t want to be getting short, so we only get short if the market starts actually falling. In this instance it has the happy effect of making sure the market has to fall from 1.1376 to 1.1359 before we get short.
By doing this we decrease the chance of being tricked into a trade because of some stop run or market maker nonsense.
In other words, we increase the odds of a successful trade.
Now we get to the end of that 4hr bar, still with no fill.
But experienced traders will recognise and take heart seeing a piddly little tiny candle.
We know that those little candles very often kick off major moves.
So we replace our buy order like this
Now, this is our entry, and this is how it looks now 20 hours later.
I’d like you to put yourself in the mind of someone yesterday looking for a place to short EURUSD.
You COULD have screen watched all day like a chump. You might have gotten the right place to enter.
But you’d be biting your fingernails all day, and then probably staying up past your bedtime to screenwatch some more.
That’s not sustainable. It’s not healthy. It leads to bad decisions down the track, and a complete focus on the current trade (which is irrelevant compared to your long term performance)
Can you see how much easier it is to simply have a set of rules you follow?
They don’t have to be my systems, there are plenty of good (and plenty of bad) systems out there. Mine aren’t even anything special, to be honest. Super-systems are inherently fragile, and mine are average systems that keep on trucking. I like it that way.
So where are we at with this trade? I’m in profit, I have no decisions to make, nothing to do.
The charts aren’t even open on my screen. I literally do not have enough spare fucks to give one to EURUSD.
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