Surprises from the wave. 2
In this video I want to explain that when we start a trade 3
we never know how far price action will take us, 4
so we have to be prepared for any scenario. 5
Let's get started. 6
The market is in an uptrend as can be seen 7
on the weekly and daily chart. 8
However, the price action on the daily chart 9
seems to indicate that we may be in the presence 10
of a possible pullback that we could take advantage of 11
due to the wavering signal at the top of the trend. 12
All this suspicion must have confirmation 13
in order to take a position. 14
Let's look at the chart to see more detail. 15
This time I am using a 1-hour time frame. 16
You can use any frame that you think is necessary 17
according to market conditions. 18
Indeed we can see that the base of the fractal 19
has been broken and the price does not seem to 20
recover and I take a short position. 21
I placed my stop loss order and 22
also the partial take profit order, 23
the latter near the next support zone. 24
After opening the short position 25
the price deteriorates and goes to the support zone 26
where my partial take profit order is located. 27
My initial appreciation of the market was spot on. 28
We must follow the trade carefully to see 29
if my partial buy order is activated. 30
The price has plummeted lower 31
and my partial buy order is almost hit. 32
You can see how there was a battle 33
between supply and demand, 34
where apparently the buyers were gaining ground 35
but then the market changed and the sellers 36
came to dominate the scene and 37
the market turned down. 38
This is a clear example that the market is 39
a dynamic agent that is constantly changing. 40
You have to learn to adapt 41
to these changes to survive as a trader. 42
Now it´s only a matter of time to see 43
how far this short trade will take us. 44
The market triggers my partial buy order 45
and I must update my stop-loss order with the 46
number of remaining contracts 47
and move it to my entry price. 48
I have also created a new partial buy order 49
in the next support zone, 50
as an additional measure 51
in case the market continues to decline. 52
The price continues to drop rapidly 53
and triggers my partial buy order 54
and I have also updated my stop loss 55
with the number of contracts remaining in the position. 56
The price starts to bounce off the support zone. 57
This is an important area of demand as seen in 58
past price action. 59
You have to be aware of what the price 60
can do from now on to make more decisions. 61
The supply intensifies and the price continues 62
to collapse below the zone of demand, 63
this means that the supply increases and 64
it is possible that we will see lower prices. 65
I have placed a new partial buy order in the next support zone. 66
The price collapses again and hit my partial buy order. 67
In this way, we are monetizing all this trade 68
from the moment it started. 69
I have updated my stop-loss with the number of contracts 70
remaining in the position and moved the stop loss 71
to a technical level to protect the gains on paper. 72
The market recovers and the price increases momentarily, 73
to meet again with the prevailing supply in the market context. 74
We must be patient and wait for more price action 75
to find out what structure is revealed. 76
Minutes later the market collapses again and continues 77
its downward direction approaching the support zone. 78
The support zone cannot contain the overwhelming supply 79
and the price collapses again penetrating this zone of old demand. 80
I have moved my stop loss to a technical level 81
to protect my paper gains. 82
If the price returns to this level and penetrates it 83
then indicates a possible temporary trend reversal. 84
The price continues to plummet rapidly, 85
I have adjusted my stop loss again to protect profits 86
and have placed a buy limit order slightly above 87
the lock limit down price just in case. 88
I don't like getting stuck in a halt trading. 89
The price finds a new support zone, 90
and from there it rebounds aggressively due to 91
the strong demand at this level, 92
which makes me suspicious. 93
After this the price falls back towards 94
the previously established support zone 95
but finds strong demand again which sustains the price 96
and generates a new increase, 97
thus creating a classic double bottom. 98
The price continues to rise supported by high demand 99
that exceeds supply and is near to my stop loss 100
which is hit minutes later and my position is closed 101
with a very good profit. 102
This is a classic example of how I manage my trades 103
when I am in the market, 104
taking partial profits and protecting paper gains 105
to maximize return on capital while dynamically reduce risk.