Why Take 2 Legged Pullback Setups As Well?

[immy]

Here is why I take those 2 legged pullbacks as well as the clean 2-3 candle single legged pullbacks. 

On the chart below , on the m5 chart, you see that clean 2 candle pullback. But that also created a 2 legged pullback on m1. 

I am not saying trade m5 as well (although you can if you like) what I'm saying is that if you trade both single and double legged pullbacks, you won't have to worry about m5. 

https://www.screencast.com/t/cVb0b1Tc

[Darren]

So if you were trading just M1, your entry would be at the high of the last bullish bar at the edge of the red box? 
 

[immy]

So if you were trading just M1, your entry would be at the high of the last bullish bar at the edge of the red box? 
 


 

Hi Darren

Great question. If I was on the M1, I'd have most probably taken the first pullback, Had I been stopped out then I'd have re-entered at that signal you're pointed to. But if it wa my first attempt and I was NOT seeing what I saw on m5 ( a clean m5 pullback) most probably I'd have waited for price to breakout out of this and create a new high and then look for a signal. 

But the simple answer would be YES! 

Hope this makes sense. 

cheers 

Immy 

 
 

[immy]

 
I can assure you of this... there is this symmetry of this setup, that when you understand it, it just pops at you when it's there. You will still feel the hesitation, don't get me wrong, that's a mental game that is a different story but connected indeed. 

A trader is never ever sure about it 100% ... I'm usually 70% when I take setups. Whenever I'm 100% turns out I was trading the wrong setup. that's my personal mental glitch. And since we are all humans, with similar DNA's and upbringings chances are there will load of others who will behave exactly like me. We can control this behavior and gradually get good at it. But it never goes away. 

So, yes, this is the variation of the pullback setup. I really want to see only the clean 2-3 candle pullabcks within STRONG or WEAK markets. 

If its a 2 legged one and I've already paid the rent, then I would go again. IF that fails too usually that knocks me out for the rest of the session with -2%. Which means I can't trade after this. 

Suppose the above happened during the London session then I will try once again at US session. Because both sessions are considered separate sessions. However my daily stop loss is -3%. So if I hit my first trade and its a rent, I'm out for the day. This saves me from having those disaster 4 and 7% days. I don't want those. So the best way to avoid those is to stop at -3%. 

This is an age old formula that works for most day traders

Cheers 

Immy 

ps: the weather is just wicked 
 
 

[Darren]

All makes sense - thanks Immy.