Live Trade – EUR/USD

Filed under: Live Trades |

 

I currently have a live trade on the EUR/USD forex currency pair, which for those of you that still don’t know is the pair for the euro and the United States dollar. If you look at Figure 1, you will see a zoomed out view of the daily chart for this pair, and we will use this to assess the trend and the important support/resistance zones.

 

Figure 1,

Figure 1,

As you can see, there is a very relevant zone in the middle of this chart (marked with a horizontal green band), and as price has been approaching this level once again, I have been looking out for any price action signals at this level.

 

Figure 2,

Figure 2,

If you now look at Figure 2, you will see a zoomed in view of the daily chart for the same EUR/USD pair. What you can see is that a little pin bar formed at the level of support/resistance in question. Therefore, what I have done is go short at the break of the low of this pin bar, with a stop loss placed just a few pips above the high of the pin bar, and a great risk-reward target set of four times the risk.

 

My only real reservation about this one is that the pin bar is quite short. However, the strong support/resistance level, combined with the great risk-reward scenario has been enough to talk me into taking this one. Whether this turns out to be a mistake remains to be seen. However, there was also a nice bearish engulfing pattern that formed on the 4-hour chart, confirming that this level has indeed been respected. Therefore, we will see how this one progresses, and take what the market gives us; and by that, I mean monitoring the trade and if price action tells us to get out at any point, then we will close the trade.

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