Breakout Strategy

Range Expansion

After a long fall and first topside range expansion (arrow) the following retracement uf US500 is used for a contrarian long position. The Low of the range is used as stop-loss (plus some 2 or 3 points). In this case a 10 point risk is rewarded with 25 points of immediate reward (plus a lot more for patient traders). The rebound happened when prices retested and penetrated the lows of the day that were in the same neighbourhood as last days close.





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