This technique requires identifying a candle pattern that I call a tech one trade.
Specifically, this candle pattern is either an engulfing candle pattern or Morningstar/evening star pattern.
A special tip it may help you is to wait for the candle pattern to close and complete itself.
Do not assume that it will make a candle pattern until the candle has closed.
I use the CCI indicator and macd histogram however it may be used with other technical indicators, you may need to do some testing if you use something other than the two I listed.
The setup requires there to be some form of consolidation with a clear support and resistance identifiable on the 30 minute chart.
It begins with the candle that closes above or below the range of consolidation, specifically, support or resistance.
once the candle has closed outside of the consolidation range in price has moved perhaps 30 or 40 pips, if this activity is not something you prefer to trade fearing possible false moves outside of consolidation, you can wait for price to retrace giving you a second entry opportunity and also additional confirmation.
trading like this will take a great deal of fortitude however patients makes the trader.
The retracement will usually occur or pull back to another level of support or resistance depending on which direction prices headed.
Retracements using Fibonacci tools such as the 382, and 618 levels are quite reliable.
Often times you will notice Price retraces to an old support or resistance level, typically the high or low in which created a consolidation range to begin with.
All of these are forms of confirmation and waiting for the retracement to occur allows additional time for a trader to gauge and identify market sentiment and price direction on an intraday basis.
Please see the first chart picture of the breakout candle and the retracement.
Once the retracement to a support or resistance level has occurred I wait for the tech one candle pattern to develop. In this example using the GBP/USD 30 minute chart it was a bullish engulfing candle.
This example shows several forms of support as confirmation.
The 20 psychological level,
the daily fulcrum,
and also the 618 retracement level.
These are just a few forms of confirmation you should be aware of when using this technique.
The entry is on the close of the completed tech one candle pattern,
again a tech one candle pattern is an engulfing candle or Morningstar/evening star pattern.
The stop is placed several pips below the price swing that creates the candle pattern.
Depending on price activity at the time and also considering the actual time, targets are approximately 15 to 40 pips from entry.
You may also consider using Fibonacci extension targets based on the most recent price going on the time frame you are trading from.
thanks for reading