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"Trigger Day" Signals and Trade Setups
Day 3 Breakout Traders Trade Setup
- 01No Major Red News scheduled in the session.
- 02This setup will be a HOW or LOW opportunity. It could be a HOW → LOD trade, a LOW → HOD trade. This would be a session trade.
- 03In some setups this could be a larger Three Day Setup for a HOW → LOW or LOW → HOW trade.
- 04An entry can happen in ANY session.
- 05The 15 minute chart is the setup.
- 06The trade is to be taken in the 3 hour timing window.
- 07Entry will be on a 5 minute chart on a reversal back inside the 20 EMA after an engulfment.
- 08Stop Loss is placed above the high (selling), below the low (buying). Maximum Stop Loss is 20 pips (15 currencies).
- 09Profit Target: 50 pips on a session trade (100+ may vary depending on the instrument traded).
The Day 3 LONGS and Day 3 SHORTS concept
This is one of my favorite BTS to look for! This setup is about the third day a market triggers breakout traders into the market for the third time.
- ·Day 1: The first day a market breaks out of a daily high or daily low and keeps trading, we have new breakout traders in the market.
- ·Day 2: The second day a breakout trader is triggered into the market.
- ·Day 2 is our Trigger Day.
Day 1 and Day 2: breakout longs in the market.
In this example the EURUSD broke out on Monday of the previous week's high. It eventually failed and reversed in the New York session, taking out the LOD and closing as a First Red Day. Traders would have shorted the breakout of the LOD on Monday.
The next day (Tuesday) closed triggering breakout shorts near the end of the day.
Day 3 breaks down and triggers breakout shorts into the market for the third time before reversing in the Europe open. This gave an excellent London open long trade targeting the previous day's high (LOW/LOD → HOD).