Live Trade – Silver (again!)

Filed under: Live Trades |

I had another try at a trade on silver yesterday, and this time, unlike the first one, it was not successful. However, even though it was an unsuccessful trade, I would still like to talk you through the setup.

 

Figure 1.

To begin with, take a look at Figure 1. This is the 4-hour chart for the XAG/USD forex pair, which is the pair for the exchange rate between silver and the United States dollar.

 

As you can see, the momentum in this pair has been quite bearish for the past few days. You can visibly see this as the chart is moving down from left to right, but you can also confirm this as the 8-day EMA is crossed below the 21-day EMA. There is also a good level of support/resistance at the bottom of the chart (marked with a horizontal green band). Therefore, when price broke through this significant level with all of this bearish momentum, and then when a bearish pin bar formed confirming the bearish momentum, I took the opportunity to put an order in to go short at a 50% retracement of the pin bar; with a stop loss placed just a few pips above the high of the pin bar, and a target set of two times my risk.

 

My order was filled, but unfortunately, price has since moved up and our stop loss has been hit for a 1% loss on the bank. Although this was a decent setup, they do sometimes go against you, as this is a game of probabilities rather than certainties. On this occasion, we were wrong, but the 2% gain on the bank on the same pair just two days ago still means that we have made a cumulative profit. Hopefully, there will be similar such trading opportunities that come along today.

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