Live Trade – XAG/USD

Filed under: Live Trades |

I currently have a live trade order in on the XAG/USD pairing (the pair for silver and the US dollar), and I would like to talk you through this setup right now.

 

Figure 1.

Figure 1.

If you take a look at Figure 1, you will see the setup in question. This is the daily chart for the XAG/USD pair. What you can see is a very large bullish pin bar coming off a very significant area of support/resistance (the area marked with a horizontal red line). If you zoom out on your XAG/USD chart, you will see the significance of this area going back a few months, and it is an area that has acted as both support and resistance (in a change of polarity).

 

You can also see that the 8-day exponential moving average is crossed above the 21-day exponential moving average, signalling that this market is currently bullish. There have been a number of white bullish candles recently, and when price has tried to pull back, it has rejected the area of support/resistance, which shows that the bulls are still well in control. So what I have done here is to put an order in to go long at a 50% retracement of this pin bar, with a stop loss placed just a few pips below the low of the pin bar, and with a target set of two times the risk. This order is now very close to being filled. Hopefully, the area of support/resistance will hold, and the bulls will continue to push this one higher if our order is filled. However, we must concede that every trade we take only has a certain probability of succeeding, and losses are a part of the process of trading and the cost of doing business. Every business has overheads, and this is the main overhead that must be dealt with in the business of trading.

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