Live Trade – USD/CHF

Filed under: Live Trades |

 

I currently have a live trade open on the USD/CHF forex currency pair (the pair for the United States dollar and the Swiss franc). I would like to take you through my reasons for taking this trade right now.

 

Figure 1.

If you take a look at Figure 1, you will see the daily chart for the USD/CHF pair. This is the only chart that we will need to look at on this occasion, as we will not need to look at the intraday charts for this one.

 

What you can see on the daily chart is that the pair is in a very strong bear market. The 8-day EMA is crossed below the 21-day EMA, and it has been for some time. In this kind of market, we want to be on the right side of this strong momentum, and wait for any bearish price action signals so that we can hop on.

 

What is happening here is that price has made a new low. The previous low could be seen as a level of resistance, but price has broken decisively through this. It was at the close of this decisive bearish candle that I set an order to go long at a 50% retracement of this bearish candle, with a stop loss placed just a few pips above the high of the bearish candle. I have risked 1% on my bank on this trade, but I have again split the target levels. 70% of the lots have a target of just 1R, and the other 30% a target of 2R. Therefore, if we make it to 1R, a 0.4% profit will be locked in, letting the rest run to either 2R or the stop loss. Therefore, a maximum of 1.3% profit can be achieved on this trade. Currently, we are in a slight profit.

 

*You can see the exact levels of this trade here:

 

http://www.myfxbook.com/members/jjrgaskell/daily-trade/357261

 

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