LST's Confirmation; Trend Line, S/R, Supply & Demand

The Importance of confirmations to take trade triggered by Vladimir's Forex LST System (Supply and Demand, Trend Line Break and Re-Test and Failed  test of initial high/Low)

In his LST System Guide Vladimir has strongly emphasized the importance of confirmation existence after a Divergence exist. We can use any confirmation that we are familiar with like Support and Resistance, Fibonachi Retracement. But for me I prefer the Break and Re-Test of Trend Line, Supply and Demand rejection and Failed Test of initial High/Low.

The most logical Price Action strategy of Trend Line Break and Re-Test that I am heavily applying is Free Trend Collapse (or this link).

Below are an example of using confirmations to take a Long Trade on GBPUSD on May 14th after Asian Session.

Pic are GMT time:

The price has been trending down since Wednesday-Friday and made a clear upper trend line. LST has made several Divergence that lead to small retraces but there has been no confirmation for a reversal until the end of Asian Box on May 14th.

The last swing low that create divergence is the hammer during Asian box at 02.15 GMT. The first confirmation came after Asian box at 06.16 GMT. It was a strong rejection of double bottom created by a "long High Close Bullish Candle - YTC PAT lesson on reading bar by bar", RR/Engulfing pattern. Novice that apply cross/oscillator would jump in fear of missing the boat feeling that trend has turn bullish.

But disciplined trader would have seen it as an usually long bar. Experienced trader would not chase the price and wait for a better opportunity instead. Most of the time there would be a pullback after the break of trend line to Re-test the broken Trend Line.

Additionally, Price Action trader realize that after a strong trend (where indicator keep diverging) , the trend become hard to bent. It then might be turn to a choppy bottoming formation, or what I see here is a gradual slowing momentum continue with a growing momentum, or rounding bottom, or combination.

The price indeed broke the trend line up then retrace to test the initial low once more. This time the price over shot the initial low a little just enough to take out the stop of the novice. This move made a Hammer that also created a DEMAND area.

Thus we have had 3 confirmation more than enough of confirmations demanded by divergence triggered by LST. Failed test of initial low/double bottom, break of trend line and  price rejection of DEMAND area + Failed Test of Trend Line.

By this situation we are confident to take long so we need to look for the most precise opportunity to enter long.

There were later 4 opportunity to enter the trade provided by the market with different size of Stop Loss:

1. The 1st opportunity is at the Doji with about 12 pips SL.
2. The hammer would provide a better entry. Price action on M1 chart would clearly show this. But I'd like to recall a study by a guy (forgot the name) that after a pin (Hammer/Shooting Star) in to a clear Support/Resistance, more than 80% of the time the price would retrace toward 50% - 60% of the hammer/shooting-star body so (about the 6,18 Fibo number). So it would be wise to place order at the middle of this Hammer/Shooting star. Its about 7 pips to the low + extra 2-4 pips then the Stop Loss would be just 9 - 11 Pips.
3. The failed test to Trend Line and Hammer during US session are also good but the first 2 opportunity should have been in safe long trade.

The price indeed take of after the hammer during US session. I have been thinking that this situation might lead to choppy during London session and the move would be in US session (bed time for me)