THE PROBLEM:
Finding the perfect spot for your stop-loss is a never-ending battle for traders, and it can drive you absolutely bonkers!
A stop too tight risks you getting kicked out too early.
A stop too wide exposes you to potentially bigger losses.
It's a tricky balancing act where you're constantly second-guessing yourself, wondering if you've nailed the right balance between protecting your hard-earned cash and giving your trade enough wiggle room to stay in the green.
But fear not...
We've got your back!
THE SOLUTION: Anchor Stops Using Weekday High/Low Failure Probabilities
We've found Weekday Highs/Lows are less likely to break as the week progresses, particularly those formed on Wednesdays and Thursdays.
Real-World Example: EUR/USD (1999-2023)
Dataset Range: 25
Total Thursdays: 354
Successful High Breaks: 47
Successful High Holds: 265
Probability of Thursday's high holding until the weekend: 83.35%!
Our research shows Wednesday's highs have a remarkable 83.35% chance of holding until Friday's close, provided the day closes bearish by at least -0.5%. By anchoring your stop-loss above the high, you can slash the risk of getting stopped out to a tiny 16.65%.
Just think of the possibilities!
Ready to discover a whole new level of risk management?
Ever wondered how reliable daily highs and lows really are?
We've got the answers!
Our Weekday High/Low Break Dataset provides a detailed breakdown of the probabilities for each weekday's high and low holding until Friday's close, according to different currency pairs and
whether the day closed bullish or bearish:
1) Bullish Close - Low Always Holds >>> High Always Breaks.
2) Bearish Close - High Always Holds >>> Low Always Breaks.
Example: Say AUD/USD closes +0.5% up on a Thursday.
Let's open the Weekday High/Low Break Dataset to check the historical probability of Thursday's low holding if price closes bullish by +0.5%.
Whoa, check out these numbers!
Analyzing AUD/USD's historical price data reveals a jaw-dropping 82.86% chance that Thursday's low won't budge after a bullish close over +0.5%.
Dataset Range (Years): 30
Bullish Thursdays (+0.5%): 315
Successful Low Breaks: 54
Successful Low Holds: 261
Probability of Thursday's high holding: 82.86%!!
That's right, you heard it here first.
Do the math, and you get an incredible 82.86% probability of Thursday's high remaining unbroken until Friday's close. Anchoring your stop to Thursday's high slashes your risk of getting stopped out before the weekend to a measly 17.14%.
Folks, stop-loss placement just got a major glow-up.
Time to put our probabilities to work!
Let's see how our Weekday Highs/Lows Failure dataset can transform your stop-loss placement and improve your results.
Your Action Plan for Smarter Stop-Loss Placement:
1) Zero In on Your Favorites >>> Identify the currency pairs you trade most often.
2) Dive into the Data >>> Check the high/low holding probabilities of those pairs.
3) Level Up Stops >>> Place stop-losses according to the data to minimize risk.
Easy enough, right?
But wait, there's more...
Pro Tips for Stop-Loss Success:
1) Focus on Wednesdays and Thursdays for the highest probability of success (often 70%+)
2) Mondays and Tuesdays tend to be less predictable (30-60% probability range).
3) Friday's highs/lows remain intact until the market reopens on Monday.
Example: AUD/USD (1993 - 2023)
AUD/USD's Weekday High/Low dataset reveals a 67.40% chance the market won't break Wednesday's high (after a bearish close above 0.5%) before the weekend.
Dataset Range (Years): 31
Wednesday's +0.5%: 273
Successful High Breaks: 89
Successful High Holds: 184
Probability of Wednesday's high holding: 67.40%
By anchoring your stop-loss to Wednesday's high, you slash the risk of getting stopped out too early, giving your trades more room to breathe and boosting the probability of any Thursday/Friday short trades - regardless of your chosen timeframe.
Scalping on the 1-hour? Slap that stop above Wednesday's high for your shorts.
Swinging on the daily? Same deal – the high is your new BFF.
No matter how you trade, the high keeps you covered.
Zooming into the 1-hour timeframe reveals how resilient Wednesday's high (0.68649) truly was!
Wednesday's high was a battlefield – bombarded with spikes, dips, and relentless tests!
Yet, it remained unbroken, a testament to the reliability of AUD/USD's Weekday High/Low probabilities and the power of a data-driven stop-loss. Countless technical setups that would have been stopped out using traditional methods, like:
1) Pin bars.
2) Engulfing candles.
3) Supply zones.
4) Support levels.
5) Fibonacci levels.
...went on to be successful, all thanks to the strategic placement of our stop-loss.
The Cold, Hard Truth About Technical Analysis Stops
Let's be honest...
Can you really predict with certainty:
If the exact edge of a supply zone will give way?
When (or if) a pin bar high or low will break?
When a significant swing high will crumble?
The truth is, you can't!
Traditional technical analysis relies on subjective interpretation and leaves room for doubt.
Our data offers a different approach – one grounded in historical probabilities. It takes the guesswork out of stop-loss placement and gives you a reliable, data-backed edge, breaking you free from the limitations of traditional technical analysis.
Want to maximize Weekday High/Low Failure Probabilities?
It's all about picking the right days to enter your trades.
Here's what you need to know:
1) Weekday probabilities vary by pair; never assume odds for similar pairs.
2) The weekday you initiate your trade impacts your odds of success.
3) Each day has unique high/low failure probabilities which vary.
Best Practices For Weekday High/Low Stops:
1) Avoid High-Risk Days: Mondays and Tuesdays usually form the weakest highs/lows.
2) Sweet Spot: Target Wednesdays and Thursdays for superior odds (over 70%).
3) Data is Key: Probabilities vary by currency pair – double-check the data.
4) Moves Matter: Closes above 0.8% can make Monday/Tuesday viable.
By following these best practices, you can leverage our Weekday High/Low Failure Probabilities to improve your stop-loss placement and overall results.
Data Always Trumps Intuition!Here's the deal:
Forget gut feelings and fancy technical indicators – they're not reliable.
Instead, put your trust in the data:
Even if your gut (or favorite technical indicators) tells you one thing, always prioritize the Weekday High/Low Failure Probabilities instead. Why? The probabilities are calculated from decades of
historical price data, giving you a solid foundation for stop-loss decisions.
Think about it:
1) Can you accurately predict the odds of a price breaking above a pin bar high?
2) How about the chances of a swing low/high getting breached?
3) What about a support or supply zone getting violated?
4) Or any other technical level for that matter?
Nope!
It's impossible to know for sure.
That's where the Weekday High/Low Failure Data comes in:
Our data gives you the actual odds of each pairs highs or lows holding, not just gut feelings based on squiggly lines on a chart. Sure, technical analysis can give you a hint of what might happen, but for setting a stop-loss, you need more than just a hunch.
Would you rather gamble on a guess, or bet on thousands of coin flips?
Seems like a no-brainer to us!
The next time you're setting your stop-loss orders, remember: Trust the data. It's the most reliable way to protect your capital and increase your chances of success.