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82

DEUTSCHE

6240

614?.....

6054 5961

5775

5682 5589

5496

5310

\H-owi 2

jjykbuy

3 short -

Figure 15 The Deutschernark made only one tradable entry into the inner envelope.

Then I got long on a 1-2-3 low, got caught in the chop and whipsawed about a bit until t finally traded my way out of this mess. I hate this kind of trading series even if 1 did eventually come out on top. It is one of the dangers of trading in a range. It also shows how to hang in there until you can trade your way out. I was lucky. Sometimes these ranges can go on for months. 1 barely escaped with a profit. Usually if you can keep your cool and continue to trade according to the book, you can get out with your hide intact. I wish that I could truly share the agonizing defeats, panic, and sheer terror I experienced before learning to trade my way out of whipsaw situations.

! hope anyone reading this Manual will recall that in Part I of the Manual I stated that I would rather have multiple contracts on a low risk trade such as the breakout of a trading range, than I would to trade high risk trades such as those in a congestion area. Please, please, please look at Figures 14-161!



Some have asked, "What do I do while Im waiting for the breakout of a range?" My answer is simply enjoy the money you made from the last breakout of a range, or trade the oscillators, ledges, and 1-2-3s.

One of my students had an order to buy 40 contracts on the breakout of the range for the Japanese Yen. Check the next chart. Need I say morel?



JAPANESE m

8348

8154 8061

7968

7875

7782 7689

7596

7583

7418

.....Af\

(trevers

if I

D=8825 PR 75.16286

Figure 16 The Japanese Yen gave me a trading opportunity when it compieted its M formation. I made a profit above the 50% objective, reversed and made another profit.

1 got long the next time it dipped into the inner envelope and got out a tad better than my objective.

I then tried to go long at the breakout of a 1-2-3 low. The Yen then slipped and slid back down for awhile, finally made a ledge, then roared to a new high taking out the top of the envelope. It just kept on going from there for quite awhile.



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