Live Trade – EUR/USD

Filed under: Live Trades |

I have just put an order in for a short trade on the EUR/USD forex currency pair, and I would like to talk you through the ins and outs of this setup right now.

 

Figure 1.

Figure 1.

To begin with, take a good look at Figure 1. This is zoomed out view of the daily chart for the EUR/USD pair, and in the middle of the chart, I have drawn in a horizontal green zone that marks a significant area of support/resistance. This level jumps out at you on the chart, and has been relevant for at least six or seven times in the recent past. Therefore, I was looking out for any bearish price action signals at this level as price once again approached this level in the market.

 

Figure 2.

Figure 2.

If you now look at Figure 2, you will see a closer view of the EUR/USD daily chart. As you can see, price has slowed down at our area of support/resistance, before a very nice bearish engulfing pattern formed that took out the last three daily candles. What I have done here is to put an order in to go short at a break of the low of the bearish candle, with a stop loss placed just a few pips above the high of the move, and a target set of two times the risk – which would take us back down to the low of the move. As this target is quite far away, I will manage this trade if it is entered and be guided by what the market tells us along the way. If necessary, we will take what the market gives to us, and close the trade out if there are any bullish signals. Well, that’s it again for today, and I’ll be back with more tomorrow.

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