trade and follow the rabbit trail to pip glory! Channels are powerful trading tools that highlight trading opportunities for all 4 types of basic trade setups. Then, we drew a parallel line starting with the swing low to complete the channel. The criteria to make an entry after a pull back on a 15 minute chart to enter a trade is that there must be two 15-minute candles that support our trade. (like the outside bar in the example above).
In a perfect world the support and resistance levels will hold on forever. Our lines are drawn, we identified the breakout, and waited for the pull back.
Before you can trade with a trend line channel, you need to know what it is and how to draw it from scratch. Simply go back in time on the charts and draw yourself some channels. The channel trend line provided the perfect price target for this trend trade. Rule #6 Ride The Rabbit Trail to 50 pips using this Channel Trading Strategy! If you are throwing in stop losses 5 to 10 pips from your entry order just because someone told you to do it, then you are without a doubt treading some dangerous waters. This breakout happened on the top of the channel. We want to escape this channel and enter on our rabbit trail to pip glory! . If they arent parallel then it is clearly not a channel that formed. This type of movement creates a channel on the charts. Or should I say what less can a minimalist trader seek? Hope you find great success with this strategy and always remember to only be risking no more than 2 of your account at a time. We drew a trend line with two swing highs.