Scribd
Upload
364 views2 pages

04 - Trading Strategy - Trend Continuation

This document discusses trading trends by entering on pullbacks after a breakout from a long-term range. It recommends watching a video to learn how to trade trend continuation. It then provides two tips: know the type of trend, as strong trends respect the 20-period MA while healthy and weak trends retrace more; and the first pullback after a breakout offers the best risk-reward as many traders will look to enter the new trend then.

Uploaded by

Ryme El Otmani
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
364 views2 pages

04 - Trading Strategy - Trend Continuation

This document discusses trading trends by entering on pullbacks after a breakout from a long-term range. It recommends watching a video to learn how to trade trend continuation. It then provides two tips: know the type of trend, as strong trends respect the 20-period MA while healthy and weak trends retrace more; and the first pullback after a breakout offers the best risk-reward as many traders will look to enter the new trend then.

Uploaded by

Ryme El Otmani
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 2

This is a trade that trades in the direction of the trend with expectations it will continue trending.

The best time to trade this setup is when the market just broke out of its long-term range as this could
be the start of a new trend — and offers the greatest reward relative to risk.

Now go watch this video below and learn how to trade trend continuation…

Here are two things to remember…

Tip #1: Know your trend

By now, you know that not all trends are created equal. So, it’s important to know what type of trend
you’re dealing with and trade them accordingly.

Strong trend – This type of trend tends to respect the 20-period moving average (MA) and has little to
no pullbacks. It’s easier to enter your trades on a breakout than on a pullback.

Healthy trend – The healthy trend tends to retrace towards the 50-period MA or previous Resistance
turned Support. Thus, you can look to enter your trade at these areas.

Weak trend – A weak trend tends to retrace towards the 200MA or Support & Resistance area. You can
trade it as how you would trade Support & Resistance (the same concept applies).

#Tip 2: The first pullback is the best pullback

Here’s the thing:

When the price just broke out, many traders will be left out (and have the fear of missing out).

So, when the first pullback occurs, these traders will attempt to get on board the trend.
And since the breakout just occurred, it means the trend is new. This offers a very favorable risk to
reward on your trade as you’re entering near the start of the trend.

However, if the market has been trending for a while now (after numerous pullbacks have occurred), the
odds of you capturing a big trend is much lower as the trend is “exhausted”.

You can still trade the pullbacks, but don’t expect to get a huge move out of it.

So, the bottom line is… the first pullback is the best pullback.

Onward…

You might also like

pFad - Phonifier reborn

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.

Note: This service is not intended for secure transactions such as banking, social media, email, or purchasing. Use at your own risk. We assume no liability whatsoever for broken pages.


Alternative Proxies:

Alternative Proxy

pFad Proxy

pFad v3 Proxy

pFad v4 Proxy