Entry, stop and target

After you have identified a confirmed volume level, three decisions remain: where you enter, where you place the stop, and where you take profit. And the profile helps you with all three.

• Entry: place your order precisely at the level of the high node, and wait for price to return to it. Many traders enter on the first touch, and others wait for confirmation from price action.
• Stop: place it behind the node in a low-volume area (LVN) or at a swing high/low, not hugging the level. Account for market volatility: if the volume-based stop is too tight, use the next node or a fixed stop suited to the range.
• Target: place it before the first high node that stands in the trade’s path, because that level may repel price before it reaches your target. And if the next node is very close, the trade may not be worth the risk.