Live Trade Number 15 – Result, and Trade Example

Filed under: Live Trades |

Well, fortunately, our order for live trade number 15 was not filled and it was cancelled after 8 hours. Price just kept moving up and had we been in the trade, our stop loss would have been hit; so I am thankful that it was a ‘sell stop’ order and that the trade was never made.

 

Trade 15 = cancelled

 

Total Profit/Loss for test = +603.65 GBP

 

I will not go into too much detail on that trade, as we never even entered it. Instead, I’d like to briefly take you through a trade that we missed on the GBP/USD pair, and look at some further indicators that I use for getting a confluence of signals.

 

Figure 1.

If you look at Figure 1, you will see the hourly chart for the GBP/USD pair. You will also see that the chart is a little more busy than usual, as I have put a couple of extra indicators on for confirmation. The thin brown lines are called ‘Bollinger bands’. This includes one simple moving average and two outer extremes. What I am looking at here is price moving outside or to the edge of these extremes. As you can see, price is at the bottom extreme of this range, which tells me that it could soon return to the moving average.

 

The blue horizontal line is a level of support/resistance on the 1-hour chart. This is my second tick in the box as it were. I have also got a 62% Fibonacci retracement, and of course a bullish engulfing pattern. That is four ticks in the box, and all of them are telling us the same thing, that price could be about to form a reversal. This is what we call a confluence of signals.

 

Figure 2.

Had I taken this long trade, I would have set an order for a 50% retracement of the bullish candle and set a stop loss just a few pips below the low of the move. Our target would have been four times our risk. Figure 2 shows that our order would have been filled and our target met. It’s just a shame that I did not see this setup quickly enough to make it a live trade.

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