This position of the lower bound of the Neutral Zone was a little confusing here, but RES 1 must be traded and especially when it sets up like this.

Price moves failry swiftly up towards RES 1 for a retest or break but before it gets there it starts to compress around the intraday fib. The Reverse Broken Triangle at the fib gives a long set up but only for 1:1 as the market hits REs 1 on the nose.

The ideal entries here are:

  • Reverse Broken Triangle long for BE
  • sell at RES 1 for 5:1
  • add to the sell using the yellow TL, possibly getting the first sell STE first

The reason I could have been so bold with shorts on this PA is the LH forming at RES 1 – obviously, I don’t know that when I open the trades, so I need to use scenario thinking to do this.

Scenario thinking gets me into the trade by thinking: if this touch of RES 1 is a LH here on the M1 and with respect to the session so far today then I need to increase risk on the short side so I’ll take the 3Min Bolli and a second chance entry.

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