Kardec Trader explains how pros stay calm when price moves against them in trendline-break setups. Let temporary pushes happen, void the trade if a second higher high forms, and wait for confirmation like a break of the trendline and respect of prior higher lows. Watch the first pullback into the 21 MA and check for support on the left before entering.
One of the things that's nice about trading a trendline break setup is you can allow for price push above the level. So the rule that we have in this scenario, price can go higher, but if it was to come back down and do a second higher high, then the trade is void. Even if it then comes back down and breaks the trend line, what we allow is for a bit of flex, because we're not trading against the trend up at this point here. We're waiting for price to come down, break the trend. So we get that here. Sometimes what will happen is you'll get a move. And you can see here, we get the consolidation move here. But what we haven't got price lower than the last higher low in the move. So we got to wait. And this is where sometimes traders can get nervous because they're waiting and waiting. Price is falling, price falling, but we're waiting for that pullback. We actually get the consolidation move right there. This is an example of the first pullback into the 21. What I will do in a situation like that, especially as prices move down, is I am going to keep an eye on what is going on to the left. So if I was looking at a big area of support that would be impeding the potential of that trade, then I may choose before the trade sets up, not to take it.
