The topic of the week for our Trading Strategy Insights is how to use price action to enter a high probability trade. I will show you how I interpret price action signals, such as pin bars and engulfing patterns to time my entries.
This is a shorter text, so I'm starting directly in my intraday range bar chart. Not on this chart I analyze the market mood. At this time of the day, the market is trading in a broad range.
I always look for enough confluence factors to make a high probability entry with a good reward-to-risk potential.
Note: Strategy workshop participants, for a detailed explanation of the settlement price strategy, please refer to the recording of session #2.
This was a relatively easy trade to enter, due to the confluence factors present at the time of entry. That said, we cannot trade "by the book" all the time. If you notice, the moving averages were still not validating my entry. Bittersweet win for me, but the other signals were so strong that I decided to enter.
I'm a strong believer in reading the market and adapting my strategies. Strict entry rules do not always work in trading because the markets change, and we have to adapt.
With an Engineering background and a Masters in Business Administration from the Tuck School of Business at Dartmouth (New Hampshire, USA), Rogerio has a deep understanding of financial markets from both an academic and a practical perspective. His knowledge and trading experience includes fundamental, technical, and order flow analysis. In addition to his signature Strategy Development courses, Rogerio also publishes his Trading Strategy Insights on the Mind Muscles for Traders blog.
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