This systematic approach removes emotion. The trade is either right (it breaks out) or wrong (it hits the stop). There is no agony in between.
First, he marked the established downtrend—a series of lower highs and lower lows. Then, he waited. Point 1: The market broke the streak of lower lows, putting in a higher low. Point 2: The market rallied to a new high. Point 3: The market pulled back but held above the low of Point 1. Trader Vic Methods Of A Wall Street Master By Victor
: Only take on aggressive risk when accrued profits justify it. Key Technical Trading Methods This systematic approach removes emotion
The price crosses the established trendline. First, he marked the established downtrend—a series of
In an uptrend, price fails to make a new high; in a downtrend, it fails to make a new low (retesting the peak/trough).