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Hello,
So I have a question regarding Trade Management for Major Reversals
Here, we enter expecting TBTL after entering on the HL MTR. Al says the 2nd leg could either be where the Play button is on my screenshot, or could be where he's drawn it.
Do you take partial profits then, knowing we're in a TR and most TR BOs fail? And knowing that the prior trend was down so we're still biased towards a Bear BO probability-wise. And also that touch of the top of the TR (where the Play button is) could very well be the 2nd leg in the TBTL?
Thanks,
Noah
That's v. helpful, thank you.
So on the very next video, Al says a couple of things:
1. HL MTR = minimum goal is 1 leg (if LL then we can expect TBTL)
2. He would TP on half once 2:1 R:R was reached, and let the rest ride until the TBTL had been completed (starting from the LL ofc)
So why are we looking for TBTL here when it's a HL?
Thank you!
Indeed quite confusing, as this slide: Slide 17 from Video 21D, shows a similar setup, but the reversal up prior to the HL MTR is arguably weaker than the one we've been looking at so far.
I'm going to guess this is just being used as a learning tool, and traders could've equally made just trading the TR and not holding for a Swing. Probabilities one way or the other are 40 vs. 60% so even if it looks like a sure thing, you're going to naturally get it wrong as there's no sure-thing, just a slight edge.
To answer your question on which looks like Leg 1 and Leg 2 (assuming I'm expecting TBTL), I'd probably lean towards Al's reading... mainly because after Leg 1, the next touch of the top of the TR didn't BO beyond it... I would assume Leg 2 needs to go higher than Leg 1?
I pasted the wrong image, here's the correct one.
Following what you said, I guess it's about Trade Mgmt then, and taking partial profits at 2:1 and watching the trade play out. You can never be too sure it will play out so bank some profits first.
