Overview
Measure acceleration and avoid chasing a move after its risk has expanded.
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Momentum trading
Measure acceleration and avoid chasing a move after its risk has expanded.
Market conditions
Start by identifying whether the market is ranging or directional, then check session liquidity and scheduled events.
Entry conditions
Write the trigger, invalidation level and maximum risk before entering. Wait for the setup conditions to be present; do not anticipate them.
Stop-loss rules
Place the stop beyond the price level that proves the setup wrong. Size the position from the distance to that stop.
Take-profit rules
Choose a target from the next structural area and calculate the reward relative to the planned risk before placing the order.
Risk / reward
Choose a target from the next structural area and calculate the reward relative to the planned risk before placing the order.
Common mistakes
Common pitfalls include late entries, changing rules mid-trade and increasing size after a loss.
When not to use it
Stand aside when spreads widen, liquidity is thin or the market no longer matches the setup assumptions.
Illustrative trade
Educational content only. Markets involve risk; examples are illustrative and are not a recommendation to trade.