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Inside Bar Pattern - Work in progress

 
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Washingtonw

Inside Bar Pattern - Work in progress

Disclaimer!! - I am currently testing this, but early indications are that it is a high probability trade.

Set up is:

1. The inside bar pattern must occur within an existing trend.

2. The existing trend is defined by a 10 period HMA.  This must have been either red or blue for 3 candles as the strategy does not work in consolidating markets.

3. The second bar of the inside bar pattern must be smaller than the first bar, and must occur at the top of the first bar in a bullish trend or the bottom if the trend is bearish.

Trigger:

Enter when the price breaks the high/low of the first bar.  If the break doesn't happen within the next 2 candles, I avoid the entry.

Stop Loss:

1 pip below the low/above the high of the second bar of the initial pattern.

Take Profit

I am experimenting with trailing stops/cross of HMA/change of colour of HMA.  Worst case scenario is just to take profit when it exceeds 2 x SL.

Fri, 10/05/2018 - 12:13pm
 
jan_1

Also have a look at price cycle for your profit target

 
Nick Sammy

Congratulations Washington for getting funded

Back testing is hard work

 
gpdno

Inside bars are one of my favorite trade set-ups. I will often take the same trade a couple of times as long as price remains inside the mother candle.

Peace,
Greg

 
parkville18

I find that the engulfing bar setup is also a very accurate setup especially when you use an indicator to confirm your entry.