How do you get the Ctabs "buy" target price?
There are too many possible combinations to cover exhaustively, so general scenarios will be discussed in the context of a long position.
For the Ctabs action commentary "Next trading day, buy if stock closes above $25 with an up candle.", you have to look for an opportunity to buy the stock at $25 but only if the stock closes above $25 with an up candle. Buying at a price lower than $25 is more optimal; buying at a price higher than $25 is less optimal.
A relatively safe and easy way is to wait towards the end of the trading day before committing a buy. Towards the end of the trading day, the day's high and low points are likely to be set without further change and an up candle formation should be apparent if indeed the stock is going to close with an up candle. However, the stock price may be far above $25 in which case the buy at the higher price is still valid to satisfy the "buy" action but at a less optimal price point. That is the trade off - safer buy action at a less optimal price point. This is consistent with risk-reward in stock trading decisions. If the price point is too high for your risk-reward ratio, you may elect to pass up on the buy opportunity altogether. Between a lost opportunity versus the risk of a potentially higher real loss, the former may be more acceptable to you.
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