When the swing AB is formed and the price starts moving up 38.2% retracement of AB, we draw the Median Line set.The price bar which crosses 38.2% R is the signal bar.
The price action after this point is watched out for either a retest of the Lower Median line parallel or breakout of the signal Bar high.
In this case the price touched the LMLH in the next day and a Buy position with Stoploss of the point B could be entered.
(or) a Buy could be taken at the breakout of signal bar with Stoploss as Low of the Signal Bar.
The discipline to enter positions with a smaller stoploss point is important, as in trading markets, nobody can predict the price moves.
The targets will be when the price bars meet the Median Line.In this case ,after meeting the Median Line there was a consolidation and the breakout of a price bar which met the ML was a good entry point for adding positions or a new Buy.
Point 1 and 2 are the points to book profits.
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