Trade Number 40-43 – ANALYSIS and RESULTS

Filed under: Live Trades |

To begin with, trade number 40 and 41 were cancelled as our orders were not filled in the allotted time, and trade number 43 is still in play. That leaves us with trade number 42 to talk about, which was a trade on the USD/CHF pair that unfortunately did not come off. Here is the trade in a little more detail.

 

Figure 1.

If you look at Figure 1, you will see the daily chart for the USD/CHF pair. What this shows is that price had been retracing back down to a very key level in the market. This also happened to be a 50% Fibonacci retracement zone, to add some confluence. We were looking to trade in the direction of the long-term bull trend, and therefore we were looking out for any bullish price action signals at this level on the daily, 4-hour, and 1-hour charts.

 

Figure 2.

If you now look at Figure 2, you will see the 4-hour timeframe for the same USD/CHF pair. As you can see, there is a nice long bullish engulfing candle at this level, which seemed like a great area to be getting in on the long side. I set an order to get in at a 50% retracement of the bullish candle, with a stop loss just a few pips below the low of the move and a target of two times my risk.

 

Figure 3.

The order was filled and price gapped up at the open this week, which is usually a very positive signal of a bull market. However, after that price inexplicably capitulated downwards and our stop loss was hit – which I can only guess was a result of some kind of news event. However, I do not trade with the news and I only make trading decisions based on price action. Here are the official results.

 

Trade 40 = cancelled

Trade 41 = cancelled

Trade 42 = -101.77 GBP

 

Bank = 10,129.90 GBP (+1.29%)

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