Look at the picture - it should be clear already from it:
1) Line №1 - a sort of "guide", it shows us where trade position will be opened - to buy or to sell.
Her features from the previous maximum peaks (or the bottom or top).
It should be done by the middle of the next wave of the chart (For simplicity, the definition of the middle of the wave can be the use of Fibonacci level - 50%). This "mid-point" or 50% Fibonacci on the chart, and will serve to nasurovnem breaking and closing the candle above or below it, and will signal the opening of trading positions
2) The level of penetration is shown in the examples, as a line №2.
If the guide line is directed upward and points to buy, then the level of penetration, respectively, must break through buy-wai candle.
(!) And, this nuance is important: it is imperative to wait until the closing price of the candle, but already at the opening price of the next candle is necessary to enter the market.
With sell candle Do the same, but the level of penetration has to break through the candle to sell.
In Figure 2 you can see the real events on the currency pair USD / CHF at 4-hour chart. For trade use the best trading platform MetaTrader 4, the graphs which is easy to produce graphical layout and construction. Red arrows indicate the point of entry (at the opening price of the candle).
Stop-loss is best to place or under the last minimum 2nd wave (for positions at Buy) or a maximum of 2nd wave (for positions in the Sell).
Take profit at will either bet on census Haya 2nd wave or just use a trailing stop that can be garazdo more profitable and better to just rearrange to zero and if broken a maximum of the second wave and the price has gone further, trailing by using a trailing stop at a safe distance (depending on the interval at which you trade, although forex "middle" strategy works on all currency pairs and all time frames) or close the profit with hands whenever you want, or simply close the 50% position, and the remaining 50% treylinguete already.
