Study Guide for Come Into My Trading Room - Forex Factory

ADVANCED CONCEPTS 121
At the right edge of the chart—neutral. The trend is down and prices
are weak and closing near the lows, but there is a bullish divergence.
Tomorrow check the 25-minute chart and be ready to follow the first
cluster of the Impulse System signals.
Answer 57
B. 1 and 2. Give yourself four points for choosing the right answer.
Most people are more objective when they do not have money at
risk. Before he enters a trade, a rational trader estimates his profit as
well as his risk, compares them and makes his go–no go decision. He
tries to select trades in which he stands to win more than he risks—the
higher the ratio, the better. If the exit target is at a channel line, that target
will move with the passage of time, but it is important to have a general
idea where it is before you enter.
Answer 58
C. 1, 2, and 3. Give yourself four points for choosing the right answer.
One of the few statistically proven market behaviors is the tendency
of prices to fluctuate above and below value. Channels help identify
manic levels for selling longs and going short and depressed levels for
covering shorts and going long. Before putting on a trade, make sure
that the channel is wide enough to be worth trading. A well-drawn
channel contains about 95% of prices, but no channel is perfect. Some
price swings are so strong that they punch out of the channel, whereas
others are too weak to reach it.