Trade Plan, Journal and Analysis as at 7/11/17
1. Focus primarily on AUD/USD
2. Market Sentiment (bullish or bearish, overall view)
3. Look at new candlestick formation (consider support/resistance, line graph, trend lines and channels.)
4. Question when bull and bear exhaustion has occurred from candle stick formation.
5. Think about what trader’s expectations are bullish or bearish. (Now moment)
6. Look at MACD for trend movement (M5, M15 H1 and D1), table created.
7. Bollinger Bands – measure a market’s Volatility
8. Market Phases – Accumulation, Advancing, Distribution and Declining.
9. Economic Calender
10. 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