Trade Number 48 – ANALYSIS and RESULT

Filed under: Live Trades |

Well, I finally have a positive trade to tell you about after dismal month of forex trading so far. It came on the USD/CHF pair, and I’d like to run you through the ins and outs of that trade setup right now.

 

Figure 1.

To begin with, take a look at Figure 1 and you will see the daily chart for the USD/CHF forex currency pair. What you will see is that price has been rotating lower over the past week or two, and it has been gaining some momentum to the down side. We want to stay on the right side of recent momentum, so we are looking for any potential shorts here. You will also see that price has just moved through a very strong area of support/resistance, so I was on the lookout for any rotations back up to that area; and any subsequent price action signals.

 

Figure 2.

If you now take a look at Figure 2, you will see the 1-hour chart for the USD/CHF pair. You will see that a nice pin bar formed at our level in question, which was soon followed by two bearish engulfing patterns, which tips us off that the recent momentum to the down side is about to continue. I set an order at the break of the low of the second bearish candle, with a stop loss just a few pips above the high of the pin bar, and a target of two times my risk.

 

Figure 3.

Figure 3 shows that the target was met, and that price really capitulated downwards after this for a quick profit. This now puts us back into some kind of meager profit after a terrible run, which has hopefully now come to an end. Here is the official result.

 

Trade 48 = +199.44 GBP

 

Bank = 10,023.40 GBP (+0.23%)

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