Pattern I'm looking to trade: Descending Broadening Wedge (DBW) on Hourly & 5min
TF 5min
TF is seen here as having broken out of DBW, and has left demand zone of 425-440 for now.I'm looking to go long at several points - the first being TF's pull back to 446 (especially if this coincides with a partial decline in the hourly).
Measure rule for DBW for breakout upwards is the highest high - in this case it's around 475.
TF Hourly
Plan A
- Long at: 446, 451, 458
- Stop Loss: 443, 449, 454
- Exit target 1: 458
- Exit target 2: 468
Plan B (In the event that TF pulls back to below DBW)
- Short at: Ceiling of DBW, whenever it seems to be stopping TF from breaking back out of the wedge - if TF is trading below 443 then, that would be most ideal
- Stop Loss: Depends - either a fix stop at 443, or 1 to 2 points above DBW
- Exit target 1: 434
- Exit Target 2: 427
2 comments:
Hey Jules, I noticed this pattern on the ES as well. Do you play this pattern often and what's your experience with it? I also wrote you an email reply :)
Hi Jane, long time! :-)
Yes, I like the wedges (especially if they come with partial rise and decline) for now. I mostly trade it up (which is also why I like it now, as market has been bouncing off bottoms), and seldom trade a breakout on the downside. For shorting, I look for Head & shoulders most of the time.
Talking about ES, I just got out from another scalp. Was trading the "bump-and-run" on 5min with a target at 827. I bailed before that as usual - got out at 825.5 (long at 824.25). ES loves trading in channels - leaving me watching my P&L go up and down til I nearly went crazy...
Haven't checked my email yet, but will do so shortly.
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