another question that comes up is..... how do you deal with opening gaps ?
if the gap is smaller than 3 points, you can take a risk and ignore the gap
however if the gap is 5 points or more, you are better off taking the gap out
if the gap is more than 5 points, you can play it more safely by forgetting the previous session and starting your distance count the same day
on exhaustion moves, there can be a gap and it will move 10 more points in the direction opposite the gap
what about stops ? what kind of stop should you use ?
you need at least a 3 point stop ... .however if you can get good at this system, you can feel more comfortable with using larger stops
some people use a scale in method which involves entering a single position at each 10 ... with no stops however that is another system all together
the 50% target is so important. you have to try to take a profit on every single trade.
and the way to do this is to take a profit at the 50%
price almost never breaks out on swing frame .... on an intraday basis during trading hours
most all break outs happen during globex session
what does that tell you ? it tells you that you need to take profit on every trade where you get a 50% move from your entry
what if you don't get an ideal entry ? what if price goes 12 points instead of 10 and you have incorporated 2 extra points of heat into your target ?
you stick to 5 points from the turn, not from your entry. why ? because you must take profit on every single trade where it is possible to take a profit.