Wednesday, July 22, 2009

Trade 31 setup - ASX intraday short

Trade 31 setup

1. Saw a large quick downswing in early morning open, and I believed the trade conditions would be range bound.
2. I found a decent level to short at - around the 4060 fib retracement and near the intraday top on the way down.
3. Waited for the confirmation candle on the 5 minutes charts and shorted at 4060.5, and confirmed a falling TICK
4. risk reward would be 2 points above the 4065.5 highs, 4067.5 (risk 7 points) target exit 4041.5 or better (gain 19 points).

Regardless of how this trade turns out, I'm slowly starting to see that my strength is trading range bound days - as the tighter stops allow better psychological control, and larger positoin sizes of 5 contracts.

I'm thinking that on trend based days, I will stick to 3 contracts on entry, and allow a larger stop loss buffer - whilst scaling in more contracts as positions get in the money, and use trailing stop losses.