Learn when to close the trade before reaching the target

Learn when to close the trade before reaching the target 300 169 Minimalist Trading – Best Trading Indicators for TradingView

Learn when to close the trade before reaching the target

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Introduction

Today we’re looking at another trading setup using our technical indicators, which are considered to be among the best indicators for TradingView. In particular, we’re using the Bottoms Tops Signal in combination with the Levels and Zones, and the RSI Exhaustion.

For this trade, we use the best fx strategy that we like to use every time our TradingView indicators identify a top, in combination with the RSI chart diverging from the price, and the RSI index being exhausted as well. We also exploit the Levels and Zones to set our target all the way down to the major support level that we see. When it comes to how to read forex, you must be able to do it simply and the technical analysis must be clear otherwise, if you still have doubts, it means that either the trade is not the best opportunity or, even worse, you are not using the best forex indicator combination.

Trade setup – 13 Dec 2019

Learn when to close the trade before reaching the target Setup 1

By making the technical analysis on this TradingView chart we identify a clear trading setup with our indicators. In particular:

    1. There is a significant divergence between the price, which is moving up, and the RSI Exhaustion, which is moving down
    2. The RSI Exhaustion is bullish exhausted (colored green)
    3. There is a confirmed top

We set the stop loss a bit higher than the most recent highest price level, while we set the target all the way down to the major support displayed by the Levels and Zones because we know that the price like to test those levels multiple times and, if we expect the price to move lower, than it is very likely that it will go down all the way there.

Trade update – 13 Dec 2019

Learn when to close the trade before reaching the target Setup 2

The price is going down rapidly but with some volatility.

Trade update – 13 Dec 2019

Learn when to close the trade before reaching the target Setup 3

The price just kept falling and almost reached the target.

Let’s just be a bit more patient.

Trade closed – 16 Dec 2019

Learn when to close the trade before reaching the target Setup 4

We manually closed the trade because a new major support level appeared.

Essentially, our initial technical analysis has now changed and, if we still expect the price to reach our initial target, we must assume that it has the strength to fall against two major support levels which are, instead, creating a significant upward pressure.

This trade is one of the rare situations in which we were forced to change the plan while the trade was running. What happened is that, as we got very close to the target, a new support level appeared just before the target. This rare situation means that the price might not ultimately reach the target and rather stop before, which is the reason why we closed our trade. It’s a rational decision that we took and was justified by the significant change in the underlying technical chart. In the end, though, we still got a 5x profit.