B. Entry Point: Half position at market (1.0687) and the other half when/if the price
retrace the rising channel line
C. Stop Loss: The high of the candle inside the channel i.e 1.0753.
D. Profit Target/s: Take half profit when the price hits 100 SMA (yellow line) and move stop loss
to brake even.
E. Reward-to-risk Ratio: Risking 40-60 pips stop loss in order to win at least 100.
F. Risk percentage: Risk 2% of your account.
G. Indicators used: 100 SMA, stochastic (14,5,5), EMA 55
H. Trade Rationale: The price just broke below the rising channel and also already completed a 4 hour candle below the channel. Hence there is a big probability that the price will continue downwards. The price also broke below the 55 EMA (green line) which now acts as a resistance level. You have two options.
Either go short now, or wait for the price to retrace(if it retrace) the rising channel.
The best move is to go short at market half of your position, and the other half if it retraces the move up.
I love this trade…I was actually going to place the short at 1.07 after a retracement, but i like the idea of averaging in just in case it doesn’t retrace.
As you can see the price has retraced the move and found a resistance at the rising channel and at the 100 SMA. This was due to positive news from Greece sparked investors to sell the USD. If I was going to go short now, I would wait for a candle to close below 1.075.
