In Forex trading strategies we utilize several patterns developed by price movement for making projections. Actually, each pattern belongs of the trading technique. Among the patterns is the ruby. This pattern is built from two triangulars, which when they are attached, appear like a cut ruby. Its appearance on the chart shows possibility of slowdown of the price movement, which indicates that after solid volatility, both bears and bulls have actually lost strength and also it is not clear now where the price will relocate.
Formation of the diamond pattern happens when the strength of both bears and bulls are practically equal as well as failure of the limits of the pattern may mean that of the sides has actually taken the lead.
Keep in mind, that a ruby pattern is quite unusual and requires coincidence of several situations.

Structure up of a pattern

For accumulating a ruby pattern on the chart we need to examine the rules of plotting a triangular. We want to have 2 triangulars, which mean that we will require 6 points.
First triangular has a broadening shape and the 2nd triangular is developed as a mirrored copy of the very first one. 2 factors between, standing for the tops, in addition to all-time lows of the triangulars, will certainly coincide. As a result we have a rhombus of the irregular shape or a ruby.

Market entry

As we stated in the past, the formation of a diamond on the chart shows stagnation of the price movement, so the rate can break down the boundaries of the pattern in any type of direction.

For that reason, breaking down among the limits or consolidation of the cost outside the pattern is the he moment of going into the market. The moment of breaking down of a ruby can be regarded as an aggressive signal; investors that prefer conservative trade will wait when one or a number of candle lights will close outside the borders of the pattern.

The graph shows that after the breaking down the pattern, the price begins to in the chosen direction as well as also has made a considerable leap, which suggests that in case of the conservative purchase, part of the revenue would have been missed out on.

Protective orders

Last high of the price can be utilized as a factor for placing stop-loss order. It is important not to puzzle this level with the top of the pattern, considering that in this situation, safety degree will certainly be as well much from the price level, which negates risk management rules.

Below we offer 3 tips for putting take revenue order:
According to the risk management rules, an investor will count the variety of points to the stop-loss, multiply this value by two or three and add it to the opening price.

Establish the order at the degree of the last high or reduced. In the instance on the graph the degree of the take-profit will certainly be all-time low of the pattern, that is, the most affordable point.

Calculate the variety of points composing the largest part of the diamond as well as move this value from the high or low.

An investor can make a decision not to position a take revenue order at all, specifically if the trading platform includes a choice of routing stop, which transfers stop-loss level complying with the motion of the rate.