Potential trading area - how to find the perfect one?

Potential trading area.

. It is an area of the trading chart that when you see your heart stops, your soul sinks into your feet and you understand – you have found THE ONE!

Well, ok. I have made it sound oh so romantic and in reality it is not nearly as cool-sounding but trust me, you are going to want to look for a perfect trading area... and you are going to want to write about it in your trading journal. Do I sound like a 15-year-old? Well, I might just, for a moment.


You can determine your potential trading area by whatever way you find more fit. For example, you can use a crossover of the two moving averages crossing resistance level on Fibonacci retracement.

The only thing you need to remember is that it stands between the current price of the asset and your entry trigger. This is the area that needs a lot of your attention and it is recommended that you take a screenshot of it and store it for later comparison and research.

Storing it is going to be a perfect reminder why you entered the trade and what triggers you saw at any given time. So, as you can understand you are going to make up a system in order to have an easy access towards all of this info.


You potential trading area mush answer to one requirement only – you are supposed to believe in your success and determine that reward-risk ratio is in your favor.

Looking and sticking to this area is going to ensure that you are in the right place in the right time.