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2017issue C0112-15

An appointment-trade around a scheduled political close

A United Kingdom referendum scheduled for 23 June 2016 at 5:00 pm EST was treated as an appointment-trade whose entry, management, and exit could be written before the polls closed. After first results pointed to leave, the case used entry-confluence to define a short rule-based-entry-region, selected the whole-number-level 1.5000, and kept a Fibonacci exit and a trailing-stop in the same written procedure.

  • A known decision time makes the setup an appointment-trade, so entry, management, and exit can be written before the event prints.
  • Entry-confluence is the filter: several independent chart methods must overlap in one rule-based-entry-region instead of a single tick.
  • A fibonacci-turning-point can name a testable exit in advance, separate from how the position is kept alive.
  • After entry, a trailing-stop decides whether the position is still allowed to exist when a fixed line or a tight volatility stop is not usable.
Entries in this reading3 entries
Current trackTrailing stop87 readingsFibonacci retracement97 readingsRule-based entry174 readings

The appointment-trade

A United Kingdom referendum scheduled for 23 June 2016 at 5:00 pm EST was treated as an appointment-trade. The decision time was known in advance, so entry, management, and exit could be written before the polls closed.

The directional hypothesis was binary: sterling weaker on a leave outcome and stronger on a remain outcome. Yen and Swiss franc were named as destinations if leave passed.

After the polls closed

After the polls closed, first reported results pointed to leave and GBPUSD began rising from 1.4520. The case studied short-sale entries on that bounce rather than a sideways path.

Entry-confluence and the short band

Independent chart methods produced overlapping short candidates on the day: a channel return at 1.4740, an upper-band pierce at 1.4829, and a 127.2 Fibonacci extension at 1.4934. That overlap is the entry-confluence used as the filter for taking a signal.

A previously untested sell zone at 1.4960 to 1.5100 and the whole-number-level 1.5000 sat inside a combined rule-based-entry-region from 1.4776 to 1.5100. The band measured 324 pips on the daily chart.

Of the five named entry styles, channel, volatility bands, Fibonacci, unfilled sell orders, and whole numbers, the case selected 1.5000 because price left that level with a sharp imbalance.

Weekly GBPUSD descending channel into the Brexit week

Weekly sterling was already sliding inside a descending channel from the mid-2014 high near 1.72. The last bar on the panel prints 1.32671 after the 23 June 2016 vote. Swings and the two channel lines were read from that candlestick chart; only 1.32671 is a printed quote.
Weekly sterling was already sliding inside a descending channel from the mid-2014 high near 1.72. The last bar on the panel prints 1.32671 after the 23 June 2016 vote. Swings and the two channel lines were read from that candlestick chart; only 1.32671 is a printed quote.GBPUSD · Weekly · 2013-10-01T00:00:00.000Z to 2016-07-31T00:00:00.000Z

Turning points are visual reads from weekly bars, reliable to about 0.005. The close 1.32671 is the figure printed on the price axis, not an estimate. Channel lines follow the two boundaries drawn on the same panel.

Management and the trailing-stop

After entry, named management options were a downtrend line, an average-true-range stop, a moving average, and a stop advanced under successive lower highs.

In this path a steep downtrend line was judged unusable and an ATR stop was too tight after a 250-pip reaction on the first 30-minute bar. A nine-period simple moving average and a lower-high trailing-stop were described as ways to remain in the position.

Editorial interpretation: TradersWeek reads the trailing-stop as the post-entry test of whether remaining loss stays bounded and whether the short is still allowed to exist.

A Fibonacci exit written in advance

Fibonacci structure also supplied an exit hypothesis at 1.3351 on the 261.8 extension. That price is a fibonacci-turning-point taken from a stated ratio of a prior swing and used as a falsifiable exit. Other preset exits sat at the daily-channel floor, the whole-number-level 1.3000, and the 1985 low.

Educational research material, not investment advice. Historical source context does not establish present-day performance.
27 of 36 in the Trailing stop track
201750-56 pp.Next on Trailing stopGolden-cross breakout rules for a swing entryA golden-cross here is a 50-period simple moving average crossing above a 200-period simple moving average on a daily chart, and entry may come any time after that cross is observed.
All readings on this track · 36 readings
  1. 1988Half-day bars, a midpoint gate, and a bar-based trail
  2. 1989Packaging two-bar reversals into testable entry and exit rules
  3. 1989Weekly high and low averages as stop-and-reverse levels
  4. 1991Constant false-alarm rate for dominant-cycle stops
  5. 1992Tick-index extremes as continuation and turn hypotheses
  6. 1993Constructing layered stops from equity and structure
  7. 1993Filter crossovers with moving-average slope
  8. 1993Precommit stop bounds from equity and structure
  9. 1998Evaluating a trendline barrier that can only tighten a capped stop
  10. 1999Constructing common-number support and resistance
  11. 2001Four-step opening-hour bias and trailing stops
  12. 2004Make the trading system the star
  13. 2005A beginner stock case: stop, trail, and the pre-trade checklist
  14. 2006Sell stops that trail support after the buy
  15. 2006Treat a wave-3 label as unfunded until the stop rails are written
  16. 2008Test medium-term divergence with a trendline break and a trailing stop
  17. 2010Rule-based forex entry, stop and trail
  18. 2012Precommitting stops when one currency range templates another
  19. 2012Cat-ears as a downtrend continuation hypothesis
  20. 2013Three-average swing entry and a trailing average exit
  21. 2014Construct a dual quotient-copy trend filter under a frequency roof
  22. 2014Stop distance, size, and trailing swing invalidation
  23. 2014Long-only RSI pullback, reversal-bar-entry, and staged-trail construction
  24. 2015Dual-average regime, trigger candle, and trail as one daily script
  25. 2015Three-gate trend system: filter, trigger, and trailing stop
  26. 2016Construct HHLLS crossover and breakout entry rules
  27. 2017An appointment-trade around a scheduled political close
  28. 2017Golden-cross breakout rules for a swing entry
  29. 2017Breakout confirmation above round numbers, with nines as sell shelves
  30. 2018Classify diamond geometry before the breakout
  31. 2019When trails and stops betray the support read
  32. 2019One-triggers-the-other pairs for preplanned swing entries
  33. 2019One-triggers-the-other orders for a breakout and its stop
  34. 2019When the second decision unbounds planned risk
  35. 2020Last-Hour Breakout With a Same-Session Flatten
  36. 2020Couple the slow period to stop-loss and trailing-stop settings
By fieldEntry and exit rules206 readingsBy year2017100 readings
All 87 readings tagged Trailing stop
Also on Trailing stop5 readings
2006Treat a wave-3 label as unfunded until the stop rails are written2012Cat-ears as a downtrend continuation hypothesis2012A weekly-close test of impulse, correction, and the 61.8% stop2014Stop distance, size, and trailing swing invalidation1988Half-day bars, a midpoint gate, and a bar-based trail