I took a long trade on EUR/USD this yesterday. Here is a 4 hour chart with the yellow arrow which is where I went long. I actually drilled down to the 1 hour chart to enter on a bullish candle, but I am managing targets on the daily chart with support levels drawn on the 4 hour chart. You can see I am still in the trade, and I luckily timed it to perfection, however, I have trouble with targets. The price went up and I was at 4:1 R/R yesterday, but I am struggling to understand whether I should have taken any profit by now? I was waiting for the next swing point on the daily chart at 1.18, but it nearly came and stopped me out today. I didn’t see any other level for me to take profit and I don’t normally like to trail my stop loss. I know it can still hit my target, but am I doing the right thing here by not having taken any profit? How would you manage or have managed this trade if it were you? Is it ok to let it get stopped out or I be reducing my risk?
Whether you should have taken any profit or not by now really depends on your trading strategy, which should have its clear criteria about where targets are. You shouldn’t really be judging whether this was right or wrong as an individual trade. What is important is how your criteria work overall over a period of time and a series of trades.
I actually took the same trade as you but one of my criteria is the 200 period SMA and I closed out when the market failed there yesterday. One other line that I watch is the weekly close on Friday’s. We have just broken down through that and there is a good chance we will see some lower levels here so your stop may be at some risk.
Are you still in this trade? I guess your stop level is around 1.1625, which seems a reasonably logical position. We have not nullified this recent up move on the 4H yet but if it starts trading below your stop level then it suggests that move would be over for now.
Personally, I am neutral on EU right now. My 1H analysis still suggests the down side is vulnerable (no change overnight) but not enough to trade it as such. So I am sidelined at the minute.
But I am interested to hear how you proceed with your trade and how it ends up for you
Thanks. I did decide to exit the trade last night for a tiny profit, and you are correct my stop loss was at 1.16240, so I would still be in the trade. I have also been long on AUDUSD and have a much better stop loss on that as I luckily managed to pick the bottom using the 5 min chart and I did take profit on that last week unlike EURUSD. Are you in any other swing trades at the moment and how many do you normally have per month? Thanks!
Well done!!! Looks like you would have been stopped out now if you had left it!..……………