Hi Rick,
I think I've got a handle on identifying Engulfing and Pinbar Target candles but for some of the finer points which I am hoping you can answer:
CHART TIME FRAMES (TF)
1. When you are watching/scanning charts to identify a Target Candle, I understand that you can use any of the TFs from M5 to H4. However, you seem to be trading mostly M5 charts lately and just using the H1 to check the direction of the trend and to identify Supply & Demand Zones. Is this the best way to go about scanning for Target Candles ?
TREND LINE
2. When trading on the M5 chart, is the H1 the best TF to look at for establishing the trend line ? And the period to consider is back to the previous Structural High for a SELL trade setup or Structural Low (SL) in the case of a BUY trade setup, yeah ?
3. Am I correct in thinking that you use the candle Lows to trace the trend on a Buy Setup and the candle Highs for a Sell Setup ?
SUPPLY
4. Are Supply Zones defined as the point at which earlier price action has been reversed by either resistance or support and retested multiple times ?
5. When you say 'don't trade into resistance,' what does that mean ?
EXIT POINT
6. Is it better to stick with the pre-determined Take Profit (TP) point as equal to the range of the Target Candle when you opened the trade even if there have been very few reversals in the price action movement ?
7. Or should you just let these trades run until there is a significant enough reversal in the price action, and if so, what would you consider to be a significant enough reversal to close the trade ?
PLANNING TRADES
8. I've heard you suggest that the beginning and end of the week are not ideal times to trade because there a lot of false moves made at those times. Does that mean that the last candle for the week should not be used or seen as a Target Candle ?
9. How can we make trade plans or seesetups over the weekend for the coming week then, is it simply a case of wait and see what happens ?
Thanks heaps if you can clear these up for me. Depending on what the answer is to some of these questions I should have a few setups ideas I can post. And I've attached a copy of what I'm calling 'The Book of Rick,' with a bunch of the posts that have been explaining the Target Candles strategy here. I hope that's ok with you.
Trading Target Candles.pdf
