Pattern Scalping Strategy
We can define technical breakouts as the cases in which a range breaks down without any previous or obvious reason. In the case of the news released traders know that they are under the possible effects of an unexpected argue that could affect to the trade market the whole day so they are prepared for it; while with a technical breakout anyone could be catch unaware.
Technical breakouts are almost impossible to predict and sometimes also almost impossible to explain.
Ought to their unusual and sudden apparition scalpers should be much more conservative when scalping this pattern than in the case of scalping the news released. The main risk is to find a market that is up and suddenly goes down without warning; to avoid the chaos is recommend to trade with small sizes and stop-loss orders.
The key issue is to identify the phase of the range pattern- that could be up or down- and trade it in short periods of time applying the general rules of technical trading.
Rodomi pranešimai su žymėmis patterns. Rodyti visus pranešimus
Rodomi pranešimai su žymėmis patterns. Rodyti visus pranešimus
2011 m. lapkričio 29 d., antradienis
Scalping the flag pattern
The flag pattern in forex scalping is understood as the limits of an upper or lower range pattern that could be trade to exploit benefits without taking big risks. They usually last for 30 or 60 minutes.
With this kind of pattern the trade strategies can be applied without the risk of big losses because the volatility is almost inexistent. There are no great expectations of big gains and the activity could be quiet unexciting.
In the graphic we can observe three flags registered in the USD/CHF pair; the first and the third are perfect to trade because they consist of a simple range without change of directionality. To exploit a flag it’s important to identify the moment when the price rises and becomes closer to the upper part of the flag, when the situation reverses is the moment to issue the sell orders. In this moment we can get profit of the established range pattern by entering small and quick different sell orders.
The same happens when the price falls and becomes closer to the lower limit of the flag, traders should wait until it begins to rise again.
Scalping the market trough the flags is an easy and secure technique but traders should be careful of not to be caught in the breakout when the flag pattern dissipates and the main trend appears.
With this kind of pattern the trade strategies can be applied without the risk of big losses because the volatility is almost inexistent. There are no great expectations of big gains and the activity could be quiet unexciting.
In the graphic we can observe three flags registered in the USD/CHF pair; the first and the third are perfect to trade because they consist of a simple range without change of directionality. To exploit a flag it’s important to identify the moment when the price rises and becomes closer to the upper part of the flag, when the situation reverses is the moment to issue the sell orders. In this moment we can get profit of the established range pattern by entering small and quick different sell orders.
The same happens when the price falls and becomes closer to the lower limit of the flag, traders should wait until it begins to rise again.
Scalping the market trough the flags is an easy and secure technique but traders should be careful of not to be caught in the breakout when the flag pattern dissipates and the main trend appears.
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