Risk Probability Calculator - Continued...
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February, 2004
By Sure-Fire Forex Trading

Once you have downloaded the RPC you will see an excel sheet like the one above. Below you will find an explanation of its use. You will also not that there are two sheets in the file. The first "sheet" is for any currency pair that has 4 digits after the decimal place and the second "sheet" is for currency pairs with 2 digits after the decimal place.

Chart Points

Once you have identified a trend or you have determined that you wish to enter the market either long or short, your next job is to mark off the chart points just like the examples above. Point A will always be easy to find as this will be the start of the downtrend or uptrend. Point B will be a recent "peak" in an uptrend or "valley" in a downtrend.

Once you have these two points you can enter them in the appropriate places and the excel sheet. This will automatically calculate everything else for you. Point C will be the point at which the pullback stops before the trend continues.

So far so good.

The only problem this is that in real life you will not know where Point C has formed until after it has formed. By this time it may be to late.

To gain the advantage you can use the 0.382 retracement level which was already calculated once you input the Point A and Point B levels. This is a temporary point C to allow you to enter a trade. Once the actual Point C had been formed you then enter that level. You may have to adjust your limit order after adjusting Point C if you entered the trade using "orders" e.g. once you have Point A and Point B you have enough information to set your entry order, stop loss order and limit order.

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