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Low Hanging Fruit (LHF) — Trend Continuation

Low Hanging Fruit

A thing or person that can be won, obtained, or persuaded with little effort.

The "Low Hanging Fruit" (LHF) trade is a trend continuation trade.

This setup will match a market that has already broken down from the HOD or has broken up from the LOD in the previous session. The LHF is the continuation pullback in the direction of the existing move.

Often this will be the last leg of the move since it's further from where the original move began, but it's a continuation of the existing move.

This is a "bread and butter" type trade. It may not have much juice to go very far, typically 25-50 pips, but it's usually a high-probability, "easy," "low stress" continuation trade for that session.

My goal is to look for easy, high-probability trading setups. If the market is going to give me some "low hanging fruit," I'll take it!

Some days this can be the easiest, cleanest, simplest trading setup in my session. I can take that trade and be done in an hour with "no stress," and cash in.

Mechanical rules — Low Hanging Fruit Trade Setup

  1. 01Has already broken down or broken up in a previous session. "Trending."
  2. 02This session setup is a "Pump and Dump" to sell, or a "Dump and Pump" to buy.
  3. 0315 minute chart for the setup.
  4. 045 minute chart for entry with a close back inside the 20 EMA.
  5. 05Stop loss max of 20 pips (or less for currencies).
  6. 06Profit target: (25-)50 (100) pips (will vary for different instruments).
  7. 07I will wait for a 15-30 minute "Pump" of 25-50 pips into the trend before entry to SELL. I'll wait for a 15-30 minute "Dump" of 25-50 pips into the trend before entry to BUY. Occasionally it can be 30-45 minutes.
  8. 08If the market is moving down, measure 25-50 pips ABOVE the LOD. If the market is trending up, measure 25-50 pips BELOW the HOD. This is the potential "STRIKE ZONE" — levels where the trade may reverse in the "pullback" or "stop hunt" toward the trend before giving us our entry.
  9. 09This is the Peak Formation toward the trend before resuming the move.