The DP set-up is a very good setup for nailing the “end” of a trend, but by definition because it is a “trend termination” setup, you need to have added confirmation that a higher degree turn is coming in. That is why I always say be very cautious about DP’s on day like yesterday when the larger degree trend was down on 3 of the 4 US e-minis.
However, let’s look at what the “worst case” would have been on the 3min YM (the ES was a lot better than this with only one -1R loss yesterday). As you can see, there would have been three -1R losses BUT, as I said in my last post, on days like this, when the trend looks to be more down than up, caution is advised on taking long trades, so the more experienced traders among you would not have taken these sell setups.
Steve
However, let’s look at what the “worst case” would have been on the 3min YM (the ES was a lot better than this with only one -1R loss yesterday). As you can see, there would have been three -1R losses BUT, as I said in my last post, on days like this, when the trend looks to be more down than up, caution is advised on taking long trades, so the more experienced traders among you would not have taken these sell setups.
Steve
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