فوركس ساتو

EXIT / ENTER REVERSE THINKING
I should mention here (since I haven’t mentioned it so much earlier) that many
of the conditions of why you would want to exit a trade are frequently also
conditions of why you would want to enter a trade in the opposite direction.
When you see a reversal of a petit trend (regardless of direction) then you look
for opportunities to enter in the opposite direction (or for a potential
continuation). Hence the title of this section – “Exit / Enter Reverse
Thinking” – when you see an exit for the previous petit trend you think about
entering on the reverse. Of course you would (normally) only enter during a
prevailing trend in the direction of the trend (entering the reverse of the pullbacks),
but in a range you can play both sides.
PICKING TOPS & BOTTOMS (PART B)
So above you’ve learned some of the elements to watch for to be able to pick
at the tops & bottoms. These are some of the biggest & most important ones
to be aware of, but there are certainly more (by studying your charts you’ll
come to discover some of the minor things to watch for). Now what you’ve
learned above is the basis, the foundation, of just about everything else you’ve
still got to learn in this eBook.
The following chart shows you most of the elements you’ve learned thus far
(it doesn’t have all the elements because it’s difficult to find a chart over the
past 24 hours (the limit of how far I can see one-minute candles with me
charting software)) along with a brief review (starting from the left side
moving towards the right side).

On the left you see a consolidation pattern that usually precedes a market
movement. After it broke out the bottom of the consolidation (with a candle
that formed completely outside the consolidation range) you jump in on a
trade going short (meaning going down) after the market broke out of the brief
(two candle) stagnation. The trade continues moving down, but then you exit
once the trendline of your petit down trend gets broken. A new, but shallow,
petit uptrend gets established. This petit uptrend could simply be a
retracement with the potential that it would resume a down trend, however
once you’ve seen the candle that “shoots” up you think that perhaps that the
market is now going up (after all the petit uptrend is shallow enough to almost
be considered a stagnation) and so you decide to take a chance at that
Caffeinated candle. Sure enough going long (entering a trade going up) was
the right call. A couple of minor downward candles don’t scare you off, but
then you find that you’ve entered what appears to be a stagnant zone
(appearing to have a rounded top). Sure enough, as soon as that candle broke
down from your stagnant zone (plus your steep trend line broke) you decide to
exit your trade. Since you’ve had a prevalent uptrend you simply wait to see
what happens next (not entering another trade). Well a stagnation develops,
and once again a breakout occurs from the stagnation, and since the breakout
occurred going up you quickly jump in on a trade again. It continues moving
up then a couple minutes later had a little down movement. You might have
gotten faked out by this causing you to exit your trade (which you still would
have caught at least a few pips) or you might have remained in the trade (or
jumped back in). Shortly after you see a “Yikes!” candle and the next minute
your trendline breaks. For sure you get out at this point having secured at
least 5 pips (from that previous stagnation). Well, we are at the end of the
chart and you’d be waiting to see what else develops.
So far the charts above have been of EUR/USD. Here is a snapshot of
USD/JPY over the past 24 hours. I won’t explain everything that happened
but just take a look at this chart. Do you think that in the past 24 hours you
might have been able to scalp this for some serious profits??? By the way,
each price increment on this chart is 10 pips (it moved up about 70 pips then
went down about 110 pips… plenty of pips that could have been caught any
time that you would have been available to be trading it).

What do you see on the following chart of EUR/JPY? How would you have
considered trading it & why?

Go call up your one-minute charts NOW of EUR/USD (and a couple of the 4
pip minors) to see what you can spot that has happened over the past 24
hours. Start from the left side of the chart, moving towards the right, and
simulate for yourself what you would have done based on all the things you
_have learned so far. Then watch the real time movement of the charts looking
for petit trends that you could possibly trade and just pretend you are trading
(or actually trade in your demo account). The more time you spend watching
your real time charts the more you condition your eyes to recognize the good
opportunities and develop the cognition of how to react based on what the
market is doing.
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