Hubert Senters here.
Let’s take a look at AMD as a potential bracket trade example of how the handbook once you’re in one of the successful for you. Pretty simple. The bracket trade was $69.88 or $64.06.
If it went below here you would obviously short it. Since it had a trade above at $69.88 if that’s your rule you’d be long right here on this second. After you get the bracket the first day after that so you’d be long here.
Your stop would be $64.08 so your long at $69.88 and your stop is $64.04. How I like to do is I keep it simple. You can either use Fibonacci extensions or you can just use. You can eyeball it. Leave it or not you can do this. You get your risk reward ratios down right.
You can say my risk was this amount of capital. That’s how much I am owning the risk. I want a return of. If I’m going to risk one I want to make either 3 or 5 minimum so let’s just use 3 because it’s easy way to calculate this.
If that box is that high then I want to go one, two, three. My first target basically would be right there so if I’m risking that amount of money then my reward will be three times greater than that.
So this is the amount of risk. And then my first target would be right up here in this area at $84.85. In other words, this little square block here should fit in this three times one, two, three.
It’s not perfect but get the point. That’s ideal with targets and make it fairly easy because I’m a visual guy and that helps me out and it will probably help you out too.
Good luck. Hope it helps. See you on the next video.
Hubert.
