MASTER CANDLE SET UP

[Nidhish]

DEAR FRIENDS HELLOW

1. Line Bounces

We know that the more bounces a scalp or support + resistance line has the stronger the line becomes. This is simply because every time the price
bounces away from that level it shows us that the level is a strong barrier. The more it bounces the stronger that barrier becomes. So when the price manages to eventually break that barrier it makes for a much better trade.
If the candles within the master candle bounce off of the high or low of the master candle it makes that high or low stronger. Therefore, a break of that high or low should make for a better trade, as the price should have a stronger than normal rally.

2. Scalp or Support + Resistance Lines

If the master candles high or low happens to form on a pre existing scalp or support resistance line then that line becomes stronger. It becomes stronger because more than one form of analysis points to the same line being an area of support or resistance.

3. Psychological Levels

Same as above, if the master candles high or low happens to form on a strong psychological level Iwould consider the line stronger.

4. Time

The longer the master candle holds out the stronger it becomes. However, if it holds for too long I might consider it invalid. I give it about 24 hours to break. If it cannot break in 24 hours I scrap the master candle.

5. New highs or lows

If the high or low of a master candle doubles as a new daily, weekly, monthly, yearly or all time high or low it obviously makes the master candle stronger.

This is so straight forward I do not know if it can be explained any more. The master candle forms a high and a low. When that high or low is broken the entry is triggered. However, as usual this breakout trading is a little different than most types of breakout trading. I like to use my brain when entering a breakout trade. I do not robotically enter the moment the line is broken. There are several factors that dictate whether or not I get into a trade, and if I get into the trade, when I get in.

Targets and Stops

Master candles are very subjective. Targets depend on where/when they form, market conditions, and line strength. Obviously if the master candles low forms on top of a strong support + resistance line the target on the break will be larger.

[admin]

[Achintya]

Thanks Nidhish for sharing this