Live Trade – XAG/USD (silver)

Filed under: Live Trades |

I currently have a live trade order in place on the XAG/USD currency pair (the pair for silver and the United States dollar), and I would like to run you through the ins and outs of this trade setup right now.

 

Figure 1.

Figure 1.

To begin with, take a look at Figure 1. This is the daily chart for the XAG/USD pair. As you can see, the pair is currently in a very strong downtrend. Although this is a naked price chart, if you overlaid some moving averages, it would certainly show a fast moving average crossed below a slow moving average, as the chart visibly moves down from left to right. In this kind of trend, I am only really on the lookout for any bearish price action signals so that we are not trading against the dominant momentum.

 

Therefore, when a nice bearish pin bar formed at a good area of support/resistance, I 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 four times the risk. This order is now close to being filled, and if it is, I will move the stop loss down as and when appropriate. There is plenty of space for the market to move into on the downside (plenty of ‘white’ space), and our target coincides (not by coincidence) with the low of the massive pin bar on this chart, which also represents the lowest low for some time, which there may be a market reaction to. Hopefully, the order will be filled and price will make new lows. However, as always on the daily charts, we will have to be patient and see how it plays out over the next few days.

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