FRI22NOV19: COFFEE SHORT TRADE (with comments)
Why did my Coffee trade fail? This has a very simple answer, I entered this trade (as seen a few post above) with nothing else by a DAY CHART FibExt Resistance (from a previous up swing), an Evening Star and a RSI Overbought. There was not a Day Chart RSI Divergence. That is, I rushed on it.
One of the reasons my bank has increased by as much as 40% in the last 2.5 months is simply because I am basing my trading mainly on the Day Chart and I have removed trading on RSI Divergences on the Intraday Charts. These should only be used, in my trading, to fine tune the price of an entry already decided using purely the Day Charts. In the case of coffee and another recent trade using the 2h chart, we can see how easily these failed!
I am very pleased with my trading, although it requires a lot more patience, and for most part all I am doing is WAITING, it is worthy! A 40% increase with a 2% risk each trade, I believe it is great, at least for me. I am happy with.
I have to say, I do miss the 30m-1h-2h-4h trading, but not the dropping in bank that came with it!
Anyway, I have re-entered the coffee short this time with the following technicals in the Day Chart:
RSI Divergence forming…still a little premature, however, I must say. I suggest for those of you that are following my entries, that you can get a further confirmation by waiting one of more days. Perhaps on Monday/Tuesday we will have a Bear Engulging candle to boot.
Tweezer Tops, I entered using the above because of the Day TT
Intraday Chart (4h) RSI Divergence, plus a beautiful Shooting Star, Now, this may sound contradicting to my initial comments but it is not. I am simply using this extra information to make my entry, not the other way around.
Resistance level, we also have a day resistance level at this juncture.
All of the above can be clearly seen in the attached pictures…happy trading