Let's look at the horizontal line trade at the 00,25,50,75.
See the last candle?
It opened between 97.250 and 97.000
When price was 97.000 the candle was
RED.
Had you gone SHORT, you could have made money.
That's all there is to it.
Nothing more.
SEE
RED.
SEE
RED AT 97.000
GO
SHORT AT 97.000
TAKE PROFIT.
It's that simple.
Here's another example.
Price opened betwen 1.19000 and 1.19250.
The candle was
GREEN at 1.19250.
SEE
GREEN CANDLE.
SEE
GREEN CANDLE AT 1.19250
GO
LONG AT 1.19250
TAKE PROFIT.
Now, let's look at a reversal trade.
The rule is wait for 3 or more
GREEN H1 candles in a row to go
SHORT on the next candle.
The rule is wait for 3 or more
RED H1 candles in a row to go
LONG on the next candle.
Look at the last candle. The 3 candles before it were
RED. That means we wait for
GREEN to go
LONG.
I know you see that long tail and are thinking about losses so let's look at the M5 chart with the H1 background colored in.
Had you jumped in right at the open, you could have made a quick scalp.
The next M5 candle was
RED which means you should NOT BE LONG.
Later during that hour, PRICE turned the H1 candle
GREEN again and you can enter.
Now, if you are an
experienced trader, you could have gone long on the GREEN M5 candle at 1.55000 or go with the price flow at 1.54750.
The main point to see is:
TRADING AT THE HORIZONTAL LINE IN THE DIRECTION PRICE IS MOVING USUALLY GIVES YOU AN OPPORTUNITY TO TAKE PROFIT.
Now, look back... see 3
GREEN candles in a row. What happened next? REVERSAL! Look back a little a little further. Do you see 3
GREEN candles in a row? What happened next? REVERSAL! Are you starting to see a pattern?
THIS IS SIMPLE.
DO NOT COMPLICATE IT.