Stop loss in an uptrend

doubt : based on the theory higher lows should be the trailing stop loss and in that case the SL should have triggered i guess… what would have been my stop loss when the markets were in red box zone.

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If you go through the Newton Course’s topics as You can see here in - The strategies are known to everyone. Then why people still pay for it?

See - Its not about “just the Bounce strategy”.

When We’re dealing with price action we are dealing with pure psychology. And, it is more about playing with reverse psychology. So when You have a buy trade in this case, and You are moving around and thinking what is the current trailing stop loss of this trade. You need to ask your self - “What is the sell entry?”

Here comes another theory in that case which is Inside Bar strategy

Now, the candle in which You have marked that it can be the “TSL” is actually a “fat” candle. Fat candle means the candle’ high and low is too much. Traders don’t like taking any entry exit after a fat candle.

Suppose it went up making a huge candle. It is unlikely you will see a huge red candle the next day unless there is some news in involved.

Now, Wockpharma is a pharma company and it is time of Covid as We’re talking about.

I will be keeping my stop loss here first. Now it is not triggered the next day. It is a tight inside bar. It broke out. The next day is again a fat candle.

After that day, We get a red tight candle making an inside bar. So I will move my stop loss there
I have marked the region using the red line but if you move your TSL aggressively like that. I will also trigger false positive like the case of the “blue line”.

So, I will not kill my trade in this case when the red line is broken.


Now see the most important part i.e. see the case when it broke the blue line and the case where it broke the red line. They are both different. !!

After the blue line break, it immediately jumped back up continuing the trend.
After the red line break, it consolidated “towards downside”. The next candle also shows an “shooting star”. All bearish pattern.

If you see the OI that time, it adds huge OI to that upper range during this time. So I will exit near break or closing below 950 mark. (This is what I am telling you practically.)