I'll be damned; it worked this time . . .
Here you can see the higher swing low at the 0748 bar (0948 EST) enabling you to draw the first TL (1). This, by the way, is called a Stage 1 TL, usually the most gentle slope.
As the trend accelerates, a Stage 2 TL can be drawn (2). The slope is, of course, more dramatic.
Finally, as the trend accelerates even further, a Stage 3 TL can be drawn (3). Trends generally begin to break down here as Stage 3 trends can't be sustained; the angle of appreciation is too severe. Therefore, you should not be surprised by a break of the TL. Rather you should expect it. Expecting it will enable you to maintain control of yourself and move your stop rationally instead of in panic to cut your profits short.
If you didn't enter until (c), you'd be only just above breakeven when the TL is broken, so there would be no need to move the stop at all. However, if you entered at (a), you might feel compelled to move your stop up, even though there's no reaction point or swing point to move it to. The best choice, then, is to do nothing but wait, and since you haven't reached target yet, this is the most logical choice to make (there are no economic reports on this date until the afternoon).
Once price has found a reaction low at 0827, you could, if it would make you feel better, move your stop up to just below that bar. However, you're now getting closer to target, so the real business is getting as close to that target as possible, using, if you like, an end-of-bar stop, as suggested as the beginning of this thread. This would get you out at around 65 (this would not be considered cutting your profits short since you're so near target). If you were trading multiple contracts, you could sell half here and leave the stop on the other half just below that 0827 bar (price did in fact move a few points higher later in the day). However, it would also be perfectly okay to say the hell with it (since you made target), cash in your chips, and take the rest of the day off.
I have another chart to post which covers the trend situation after this initial flurry. If my luck holds, it'll be in the next post.
--Db
Here you can see the higher swing low at the 0748 bar (0948 EST) enabling you to draw the first TL (1). This, by the way, is called a Stage 1 TL, usually the most gentle slope.
As the trend accelerates, a Stage 2 TL can be drawn (2). The slope is, of course, more dramatic.
Finally, as the trend accelerates even further, a Stage 3 TL can be drawn (3). Trends generally begin to break down here as Stage 3 trends can't be sustained; the angle of appreciation is too severe. Therefore, you should not be surprised by a break of the TL. Rather you should expect it. Expecting it will enable you to maintain control of yourself and move your stop rationally instead of in panic to cut your profits short.
If you didn't enter until (c), you'd be only just above breakeven when the TL is broken, so there would be no need to move the stop at all. However, if you entered at (a), you might feel compelled to move your stop up, even though there's no reaction point or swing point to move it to. The best choice, then, is to do nothing but wait, and since you haven't reached target yet, this is the most logical choice to make (there are no economic reports on this date until the afternoon).
Once price has found a reaction low at 0827, you could, if it would make you feel better, move your stop up to just below that bar. However, you're now getting closer to target, so the real business is getting as close to that target as possible, using, if you like, an end-of-bar stop, as suggested as the beginning of this thread. This would get you out at around 65 (this would not be considered cutting your profits short since you're so near target). If you were trading multiple contracts, you could sell half here and leave the stop on the other half just below that 0827 bar (price did in fact move a few points higher later in the day). However, it would also be perfectly okay to say the hell with it (since you made target), cash in your chips, and take the rest of the day off.
I have another chart to post which covers the trend situation after this initial flurry. If my luck holds, it'll be in the next post.
--Db