In today’s lesson, we are going to demonstrate an example of H1-15M chart combination trading. Usually, the H1-15M chart combination trading offers 1:2 risk-reward. However, in this example, the buyers may need to come out with their profit with 1:1 risk-reward. We find out why they shall do that so.
This is the H1 chart. The price heads towards the North with good bullish momentum. The price breaches the last swing high and continues its journey towards the North upon confirming the breakout. Look at the last candle. It comes out as a strong bearish candle. The buyers are to keep their eyes on the pair to get a bullish reversal candle to go long.
The price makes a long bearish correction. Look at the last candle in the chart. It comes out as a bullish candle. The combination of the previous three candles is not a morning star since the last candle does not close above the bearish candle. Nevertheless, the last candle comes out as a bullish engulfing candle. It is a strong bullish reversal candle. It is time for the buyers to flip over to the 15M chart.
This is how the 15M chart looks like. A bullish candle closing above the last candle’s body would be a good signal to go long in the pair. The buyers must keep their eyes in the chart. Let us proceed to the next chart to find out how it comes out.
Look at the last candle. This is one beautiful bullish engulfing candle closing well above the last candle’s wick. A signal candle like this attracts more buyers and usually brings good liquidity. The H1-15 chart combination traders may trigger a long entry right after the last candle closes by setting stop loss below the support level and by setting take profit with 2R. Let us now flip over to the H1 chart again to see how the trade goes.
The price heads towards the North with good bullish momentum. It hits 1R in a hurry. The last candle comes out as an inside bar, which is the weakest bearish reversal candle. In most cases, H1-15 chart combination trading offers 1:2 risk-reward. The question is whether the buyers keep holding the trade or not. I may mention that it is Friday and only three/four hours to go to shut down the market. I think now you know what buyers should do here. Yes, they should close the trade and come out with the 1R profit. The H1-15M chart combination traders should not keep holding their trade during the weekend. In some cases, it may bring them some extra pips. However, in many cases, it may hurt them badly.