EUR/USD daily chart
when looking at the daily chart, we see the highest high of August at around 1.1713
in September we see the highest high at around 1.1460.
This September high point is considered the first attempt to take out the August high.
This month it is possible to see another attempt to take out the August high of 1.1713
This attempt is called the 'second time around', which makes the high from September (1.1460)
a major entry price point.
Add 1 pip to the highest point of September (1.1460 on our charts) and place a buy-stop order.
1st exit would be near 1.1780 (cavity-stop)
2nd exit would be near 1.1880 (2nd cavity-stop)
3rd exit would be below the GAP near 1.1970
Place your initial SL 4 pips below the low of the Sept. 23rd bar, which is 1.1104 on our charts.
Calculate the lot/size using the distance from entry-price to SL and the percentage risk you are willing to take.
In an earlier posting I have explained how this calculation is done.
The daily chart currently is in congestion with 14 bars, including today's bar.
We do not trade any bar before bar 17 in congestion.
The congestion is over when there is a bar that has open and close price outside the measuring bar (MB)
The high of the MB is 1.1329 and the low of the MB is 1.1180
It is the bar generated on Sept. 21st
As you can see, all following bars have either the open or the close price inside the high and low of the MB.
A congestion is bar count 11 through 21 (include the MB in the count).
After bar 21 it is considered a trading range.
If the attempt fails to take out the highest point from September, then a sell-stop order can be placed 1 pip below the low of Sept. 3rd, which is 1.1086 on our charts
"a little bit of knowledge is a dangerous thing"