Levels of support/resistance typically produce a pop or bounce on the first touch.
There is an untested level of resistance in the peak around $1850
SETUP: This is not a prediction price will get to 1850. However, if it does, enter short.
We call this conditional trading.
ENTRY: $1850
Short position
TARGETS: Conservative - $1820, Riskier - $1805
This is the first area of congestion below our entry
STOP: $1870
Above the peak of our short entry.
NOTE: In the past few plays, our stop has been too tight but the play would have worked out if it weren't.
However, it's hard to justify risking more than the potential win.
There is an untested level of resistance in the peak around $1850
SETUP: This is not a prediction price will get to 1850. However, if it does, enter short.
We call this conditional trading.
ENTRY: $1850
Short position
TARGETS: Conservative - $1820, Riskier - $1805
This is the first area of congestion below our entry
STOP: $1870
Above the peak of our short entry.
NOTE: In the past few plays, our stop has been too tight but the play would have worked out if it weren't.
However, it's hard to justify risking more than the potential win.