Bounce - Finding an Uptrend

The Uptrend example as per bounce charting -

When a scrip makes higher highs and higher lows; that scrip is considered to be in an uptrend. We spot uptrend using the HHHL (Higher High Higher Low) Pattern.


Price makes initial move.
Then, it pulls back making a low. It is called retracement.
Now, if it breaks the high it made previously; Higher High is achieved .
Now to complete the whole setup, it can not retrace more than the previously made low!

Right?

Now, when can we declare that HHHL Pattern has been confirmed? The moment it is confirmed we can declare that the scrip is in an uptrend.

The moment it breaks the Higher High, We can tell that our Higher Low is confirmed.

Hence, Uptrend is confirmed!


In the above chart, one can see the Uptrend has beautifully triggered.

So, What is the trade here?

Entry - We are entering the trade the moment the uptrend is triggered,

Stop Loss - We are putting the initial stop loss at the Higher Low created before the entry because if that breaks, it will not be uptrend anymore.

Target - Only Astrologers can tell that where it will break the uptrend. If one exit early, he can miss huge profit.

Managing the Trade - Every time a new Higher Low is created; We should move our stop loss to that new Higher Low to protect our profit! It may also happen, instead of Higher High, Lower High is formed. But, We’re not concerned about where the Higher High is created right now. As long as Higher Lows are formed; trade goes on.


Let’s summarize the whole trading activity in our aforesaid plan -

Date
Comments
10-July-2018
Entered at 1008.4 which is high of 5-July-2018
10-July-2018
Stop Loss at 964.5 which is low of 6-July-2018
18-July-2018
Updated TSL at 1069.6 which is low of 17-July-2018
27-July-2018
Updated TSL at 1107.8 which is low of 26-July-2018
6-Aug-2018
Updated TSL at 1169.55 which is low of 3-Aug-2018
14-Aug-2018
Updated TSL at 1182.7 which is low of 13-Aug-2018
6-Sep-2018
Updated TSL at 1208.5 which is low of 5-Sep-2018
14-Sep-2018
Updated TSL at 1228.85 which is low of 12-Sep-2018
17-Sep-2018
Stop Loss is hit at 1228.85

We’re netting a profit of (1228.85-1008.4) = 220.45 points which is roughly 21.86% from our entry point. The risk taken here is the initial stop loss i.e. (1008.4-964.5) = 43.9 points which is roughly 4.35%. After the initial stop loss update the trade becomes risk free!