Pattern «Flag» on the currency market are often but not as strange, all describe what is usually a good pattern, but basically no detail was not clear working strategy forex enter the market, after it was spotted this graphical combination.
I propose to consider a fairly simple system to enter the market, using this combination — «Flag + ABC».
Very often, it appears after a prolonged or sudden movement, and is nothing like zone correction for further continuation of the trend.
Consider the essence of strategy Forex & Crypto «Flag + ABC»:
1. We find a sharp movement in the price chart — momentum and see how events develop in the future.
2. Ie must be remembered that after the sharp movement is usually consolidated and now that we are waiting.
3. Under this strategy, forex, do not make deals with the first fall-back — have to wait until we see the completion of the formation pattern of «Flag».
4. Our task is to wait and see on the price chart 3 waves: A, B, C in the pattern «flag» (see example below):
5. This graphic is called a combination of many different ways — some nicknamed her ABC. That’s our job to wait until the last wave is formed with, and only then, at the end of the C wave, we will enter the market in the direction of the trend — in a limit order (in this case, Buy Limit).
6. But always worth remembering that only one ABC — that’s no reason for the transaction. Since login to want to find at least 3-4 trading signal to the input — this can be divergence, according to rollback levels Fibonacce (and very good, if our point C would be exactly the level of 38,2 or 61,8% of Fibonacci from the previous motion ).
7. In this case, as soon as we have already identified the movement, and presumably we have point A and B — we are over the top (for downward movement on the contrary), and point B — and a line parallel to construct a parallel through the point A — then we have drawn channel.
8. And only now can the line of the channel, carried out through a point A to place a limit order to buy or to sell, respectively, but do not forget the additional trading signals — for example Fibonacce or divergence, lines of support and resistance line of the channel, etc. . (see the examples at the end of the strategy — which may be additional signals).
9. Take-profit, I recommend to put on the census hai or low, respectively, or else pull up a safety stop-loss in the positive zone with trailing stop.
10. A safety stop-loss — set for the next level of Fibonacci — for example 50% or preferably 61,8% — if C falls on 38,2%, etc. — If at 61,8% — 76,4% for the set — no further recommend that, because on the market may just turn around.
11. Also do not forget that the market is not perfect, and point C has a tendency not to reach or fall below the line channels corrective movement (on this, if a limit order is not successful, then buy at the market price, if already formed reversal bar).
And do not forget that these combinations do not always arise and need to keep track of different time frames.
Examples of «Flag + ABC» in including in the promptness with various indicators, channels, muwings, Fibonacci levels: