Good morning to you all.
The first setup I want to look at with you today is a range trade. This is one that you may see quite a few of around the traps and I think they can be great setups - the key, for mine at least, is to not be too greedy with them. Last week I had one of my posted trades reach its profit target on a range trade setup - you can see the final post here.
My view on these types of setup is that they are clear for the world to see so if they manage to head in the right direction for you then you want to exit before the rest of the world tries to. On that Television Broadcasts trade you can see that there was a very long tail on the candle that actually got us out of the trade. If you had waited around to winkle out a few more cents then you may have been left sorely disappointed in yourself.
The way that I would look at this trade is to buy based on price moving higher than yesterdays close (or high if you would like to be a little more conservative). I think that a target of $14 would be appropriate for this trade with a stop at $12.50. Based on an entry price of $12.75 this gives a risk:reward ratio of 1:5 which is ideal.
Have a fun day ahead,