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.

Range Expansion
by
Tags:
Leave a Reply