Trade Plan, Journal and Analysis as at 7/11/17
- Focus primarily on AUD/USD
- Market Sentiment (bullish or bearish, overall view)
- Look at new candlestick formation (consider support/resistance, line graph, trend lines and channels.)
- Question when bull and bear exhaustion has occurred from candle stick formation.
- Think about what trader’s expectations are bullish or bearish. (Now moment)
- Look at MACD for trend movement (M5, M15 H1 and D1), table created.
- Bollinger Bands – measure a market’s Volatility
- Market Phases – Accumulation, Advancing, Distribution and Declining.
- Economic Calender
- Execute Entry, S/L, T/P and exit point.
Trade Journal + Analysis As at 7/11/17
I went long because I thought the uptrend will continue (based on support/resistance, channel and line graph) and temporary trader’s view.
Technical analysis based on candle stick reading – An uptrend was proceeding but seems like the bulls were exhausted (limited), 3 visible dojis appeared in the timeframe M15. Possible trend reversal, there was resistance.
MACD on M15 indicates that crossover has shown a downtrend.
Bollinger bands – widening
Market phase remains the same.
My first assumption was price action was leading to an uptrend and market sentiment was bullish temporary, especially on the trader’s view. Support/Resistance, no channel but higher lows and higher highs exist (An ascending channel).
Whereas, the market sentiment overview was bearish on the AUD/USD, I went for the temporary trade view with a bullish view.
Enter a trade with this view
MACD on M15 indicates that a crossover is heading downwards, MACD on the H1 indicators there is an uptrend, D1 indicators that the overview of AUS/USD is a downtrend.
Used the line graph to draw support/resistance and found that support has turn into resistance
Bollinger bands – contracting.
Market Phase remains the same.
I took a short trade, based on the MACD crossover indicating a new trend forming. Based on the orange line where the resistance was met with a huge decline at 3/11/17 12:30. My belief is that price has been overvalued and same goes with the trader’s perspective that price has a high probability of heading downwards.
The support/resistance acted as a major support, where the resistance turned into a support level. (It was actually a major support level on the M15). Consider the market situation. Also, the economic event with the RBA interest rate was involved leading to unexpected price movement