Live Trade 121 – ANALYSIS and RESULT

Filed under: Live Trades |

Unfortunately, our live trade number 121 did not come off, but I would like to take you through the ins and outs of the trade anyway.

 

Figure 1.

To begin with take a look at Figure 1. This is the daily chart for the AUD/CHF forex currency pair, which is the pair for the Australian dollar and the Swiss franc. As you can see, the pair had been trading down, with the 8-day exponential moving average crossed below the 21-day exponential moving average, and the chart visibly moving down from left to right. In this kind of chart, we should only really be looking for price action signals that confirm the medium-term bearish trend.

 

Figure 2.

Figure 2 shows the 4-hour chart for the same AUD/CHF pair. I have drawn in a very strong area of support/resistance on the chart, so when price formed a pin bar followed by a bearish engulfing pattern right at this level, this seemed like a good signal to put an order in at a 50% retracement of the pin bar to go short. Unfortunately on this occasion, this trade just didn’t come off and price continued to move up.

 

We can never be totally sure of the way that price is going to move. All we can do is try to tip the odds in our favour so that in the long term, we will come out on top over a long series of trades. At the moment, our bank is taking a loss, but I’m sure that over a longer series of trades, the bank will be in profit. Well, that’s it for today, and I’ll be back with more tomorrow. Until then, happy trading… and may the markets be with you!

 

RESULTS

Trade 121 = -101.01 GBP

Bank = 9,404 GBP (-5.96%)

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