will see them all over the place. Just wait for the price to hit point2 1 pip and instantly place a trade (entry). . After allowing for formation of points 1, 2 and 3, draw a horizontal line from point 2 outwards to form the reference resistance line. This can be confirmed by tracing the. These charts are used for trend identification.
Setup, identify a current trend. Understanding the extent of retracement will therefore aid the trader as to where the entry for the reversal trades will be made. Point 3 is.2 or 50 retracement of a line drawn from line 1. The retracement level is point. Point 3 is at a higher horizontal level than point. Submitted by Edward Revy on February 28, :30. The 1-2-3 reversal strategy depends on the trader being able to: Recognize a setup for a market reversal. However, exit can be found using Fibonacci method; or traders can measure the distance between point 2 and point 3 and project it on the chart for exit. Convert the setup into profits. Exits update: Exit strategy page 4 m forex trading strategy #3 (EUR/USD simple system) up, forex trading strategy #4-a (1-2-3, RSI macd). Take Profit, the Take Profit is usually left at the discretion of the trader. Entry rules: Once the price makes it through the pivot Line - dotted white line on the figure below (drawn using the latest price peak) - and closes above (for uptrend) or below (for downtrend) the line buy/sell accordingly.