Good Morning & welcome to the start of another trading week! Just a thought but there is only about 23 trading days of the year left!
Most people will know that I’m primarily a pivot trader but the important thing to also realise is that i never lose sight of my primary & secondary daily goals/targets. To recap, my primary goal of any trading day is 10pts – this is largely a historic target which I keep as I tend to see it as my “job” or at least what I’m obligated to do for …my family. Once the primary target is done then I have the option of an early finish or I can carry on trading that day on my secondary account which is what I refer to as our gadgets/ gizmo’s/holidays/treats etc etc..I’ll discuss this in more detail in a later post as todays trade was a very good example of how I approach this.
This mornings trade;
1. I’m initially on the Dax 5min chart but can see that there is a pretty decent sell off taking place which isnt giving to many footholds to get into on the higher timeframes so I drop down to the 2min chart
2. Price breaks down through the pivot & I can see by following the tick by tick proce action that the buyers are being pushed back at every opportunity. (check out the upper wicks on each of the red candles).This sort of trade entry is a dilemna because it is a good solid pivot entry but the 5 min chart is miles away from the 5ema. When this happens, you manage the trade as per the timeframe you took the trade (thats important until the trade is firmly in profit at which point you can manage the trade via a higher timeframe)
3. So, pivot entry, with stop at high of anchor candle just prior to the pivot break. Stop is around 20pts so normal for the Dax with a potential pivot run of 20pts so all good there.In the event of a price reversal then worse case scenario is a 20pt stop or a 20pt hedge – its early in the session so plenty of time to recover if this happens.
4. Price then makes a quick drop of 10pts+ so I’m banking my 10pts & closing the trade, opting for intial target rather than glory of the pivot run. This is fairly normal practice for my first trade of the day as I like the option of deciding what to do for the rest of the day.
Hope that’s useful!