Hi Lukuss. The chart indicates a shorting opportunity. As of the middle of May 14, Stochastics are pointing downward as is the MACD. On the 1H the trend also looks like a downtrend. Price is making lower highs and lower lows. Just before your entry, price was reacting to a resistance area (the previous swing high).
Not sure why you thought price would go higher. Is it because of the breakout of the channel that you’ve drawn? I recommend that you don’t utilize diagonal lines in your analysis. They are meaningless and serve no purpose other than to cause confusion.
I would trade on demo only until you become more consistent in your analysis.
Hi mate, I understand it’s very easy for us to find fault in your analysis in hindsight so dont take it to heart. Just try to learn.
The daily had a recent lower high. Therefore it is not in an obvious uptrend. Could be reversing or entering a range. Either way we dont know so dont guess.
You have stochastic on the chart. And within that descending wedge everytime its overbought price sells off. But the 4th time its overbought you decide to buy… if you dont use it you should remove it off your chart. As that itself was a reason not to buy if you use indicators.
Also you bought because price rallied and stay above your upper wedge trendline so why is your stop loss so far away. Either you trust that trendline in which case when price goes back below you should close out or you dont trust it in which case you should remove it. Only keep on the chart what you use.
Then look for reasons to buy and if you get a mixed picture dont do anything. Just sit patiently for a time when everything makes sense.
Remember, the smaller your position size, the more room your trade has between price and your SL. That’s all I wanted to add, you’re on the right track and you’ve gotten some top notch advice here.
Thank you very much for taking time to analyze my trade and reply. It helps me a lot, and in fact here is a list with what I think I learned from your posts:
1.The fact that the last high was lower than the previous high should have been indicating me that the trend might not be continue or that ** it could be ranging.** This is an answer that I’ve been looking for for a while because I was afraid to trade even with the trend thinking that: what if the trend is actually reversing now?
If setting the entry point based on something, then the SL/TP should also be set according to it. My mistake was that the entry was based on the falling wedge but the SL wasn’t just under the superior limit of the pattern, it was way lower.
Consider indicators if decided to use it. Lately I’ve been reading/seeing lots of articles/video that were saying that the price is the main goal, and the indicators should only confirm it. My mistake was that I didn’t consider them for this trade(except for MACD on 4H).
I should use the ATR. Not sure quite exact how to incorporate it…
Have patience is things are unclear.
@QuadPip Indeed, for the 1H I didn’t consider the indicators, because on 4H the MACD had a buy crossing signal. And yes, I considered mostly the falling wedge pattern. Thanks for the tip.
@tradeforex077 Don’t worry, I’m not taking it to heart, I’m actually happy that you share your knowledge. I usually use indicators, mostly Stochastic but I somehow considered that “price is more important” and I neglected the indicators…
@MattyMoney I trade the smallest size my broker allows me to. and that is 1 microlot(0.01). I wish I were on the right track… I have 7-8 months on demo and I’m still not on the winning side… All accounts started with 500 euros and all finished under.
If it is ok with you all, next week I’ll try to take some trades(or at least one) and post it my result. I would glad to have your support from time to time here… I really want to become profitable. I’ve invested too much time on forex…
Thanks. I have now on my charts 200 Ema, 100 Ema and 50 Ema, for long, medium and short-term trends. I’m planning to use this along with Stoch/MACD and resistance/support areas. The plan(if not to ambitious) is to take 50pips/day. I’ve scouted my favorite pairs but I have not seen a good opportunity so far, so I’m waiting.
I’ll use microlots and a R/R of 1-1, at least.
1.down-trend
2.stochastic was in overbought
3.MACD was in a hidden bearish divergence considering the current and previous highs
4.on the next lower timeframe(30M) It was the first bearish candle and first decrease in momentum according to MACD. I guess it was a mistake… I was suppose to stay on one time-frame only.
Now… what I know I did wrong:
1.SL was right above the resistance I’ve drawn… It seems that price stopped right after my SL.
2.I didn’t wait for some confirmation on my trading time-frame.
3.even if it was overbought, there was no entry signal on stochastic.
4.macd had shown no signs of losing momentum or weakness.
5. forgot to use ATR
If you guys see some more mistakes, please feel free to post it below.
I had one more trade, I’ll post it later.
Edit: This trade was a losing one. Somewhere around -40 pips.
Hello your really putting yourself in a bad situation. Just looking at the pair from the 1H & 4H the pair started reversing up around the 1.21 mark. Nothing in those last few hours warrants a short position yet IMO. Yes the pair will eventually retrace back down but not yet you have to ride the momentum. The bullish pressure continued to increase you put a SHORT on the wrong area. You should actually wait for the move to start materializing before you actually open a position. For example that large bearish candle would’ve gave me pause to see if the pair was ready to start reversing. After the next candle in my head the pair is either exhausting running up and it’s taking a pause and might move sideways for a bit or it’s possible it maybe gearing up for a potential reversal but I still would’ve waited for a more concrete view before proceeding. Also -40 pips on GBP/USD is WAY TOO TIGHT. This pair can easily move 40-90 pips in 1 hour. If your looking at daily charts you need to widen your areas it’s way too short unless you’re trying to be a scalper.
I analyzed AUD/CHF?
Why?
Trading with AUD pairs seems to me they are more predictable, and pip value is lower, so if I lose 20 pips my loss is not that big. to be honest this your main mistake limiting your opportunity. ive not been trading that long but i would nt trade that chart. there so many other pairs to view and the futures
Trading AUD is the same that trading any other cross currency, except country risk factor. Aussie is commodity dollar so its very sensitive to swings in commodity prices as well as demand on raw materials from China. I prefer to avoid trading AUD during late phases of the economic cycle. But now I think it’s excellent pair to trade because commodities are on the rise.
@momoisnyc, Dissapointed that you seeing it as “putting myself in a bad situation”, but anyway…gave up trading pound for now.
@greenscorpio Actually, I tend to disagree partially here.
You are right probably when talking about people like you, or other experienced traders. But personally, watching too many pairs at a time it’s exhausting and there is a higher probability of doing mistakes(at least on my side).
im not that experienced, though i would say one of the most vital things for becoming successful is going through the charts at the beginning week and accessing the charts at the different time frames.i would nt recommend “day traders” having more than two trades open at a time anyhow, but that just my opinion
So I had initially 2 trades, then the price went lower and I find it as a good opportunity to re-enter long.
At this point I had 3 trades long. Then the price fell even lower, and the broker closed automatically one of my trades at minus ~1.5% of the account.
The second trade I closed in with profit of around 1.2% and the third one at one point it was at 2% profit, but didn’t close it nor secure it(moving stop-loss at least at BE). Fatal mistake of course, because then it fell and I’ve lost another 1.5%.
So right now, my (demo) account just suffered a negative resize of about 1.8%.
For a beginner, this is quite difficult. You need to try to look at how experienced traders do it. You can also try contacting the support of the broker you are working with.
