Click on the chart to enlarge it.
In sum, there is a three-fold benefit to rolling down to lower timeframes once a good-looking high timeframe setup has been identified.
First, the zooming-in almost always allows us to reduce our risk. Secondly, it normally results in an entry price that's even better than the one Ocean provides us already. Third, the higher timeframe involvement (relative to our personal time horizon) means that the potential trade will have a commensurately larger profit potential.
As an added and more subtle benefit, if we find Ocean setups and entries on lower timeframes but driven by higher ones, we are much less likely to be shaken out of the trade as the result of minor random fluctuations on the lower timeframes.
Therefore, since our trade is being sourced from higher timeframes, after the trade gets underway we'll most likely give it more breathing room. Other traders, entering the market on lower timeframes, will likely spook more easily (as well they should) and tend to exit after making a few bucks—just as the market is finishing its shakeout and resuming its thrust.
After getting into a trade, nothing hurts more than seeing prices move against your meager profits just enough to shake you out, only to see the market resume again in the direction that you were anticipating. That seldom happens when using advanced Ocean analysis and applying the rules correctly.
Will you still lose money from time to time or be knocked out of good trades? Of course, but at least the deck will be strongly stacked in your favor, so that probabilities will be working for you. And since financial markets never offer guarantees of any kind, working with greater probabilities is what successful trading is all about.
|
