Kardec Trader breaks down the break and retest rejection strategy. If the market opens above yesterday's low, wait for it to break below then retest. If it opens below, look for a rally that creates a large wick at that level and closes red, signaling a short trade.
Let's just go ahead and talk about a break and retest rejection. Here's example one, and here's example two. In example one, we open the day above that previous day low. So for us to even get interested in a trade, if we're opening this low, we need the break below that low. We need the retest of that low. Example two is we go ahead and open the market below the previous day low. What you're looking for in the morning is a morning rally straight into that level. You get a huge wick candle leaving behind a huge tail at that previous day low. Candle closing red right underneath the that level. And then you know we're about to make some money.
