I entered this trade and am making a profit that I am extremely happy with.
But, I do not know if it is dumb luck.
Did I enter based on, what you would consider, nothing?
Or did you think, I entered on enough of a rationale.
My reasoning was:
The price made an obvious bounce off the bottom of the Bollinger Band, I entered the trading expecting it to continue up to the support of the opposing side of the band.
Similar to 1, there was an obvious bullish trend off the reversal, I used the MACD and saw that the trend seemed to be gaining obvious strength + momentum.
Basing off the stochastic indicator, the price was being oversold prior to the reversal, so I jumped on soon after.
(I entered the trade on the blue arrow below the green candle, all the way to the right of the screen, just to clarify).
I’m open to any criticism and any evaluation.
Thanks so much in advance.
Hey good night, I have a couple of observations, I hope they help.
Thru the history you can see there are previous support levels, so the chance that it will bounce again was good.
The combination of the support and the Bollinger Band reinforce this concept.
I cant see the general trend, so its hard to know if the price is ranging instead of trending.
The indicators you used, gave you a good perception.
Even thou you see it is oversold, some times there is not enough evidence it will reverse, it had a good momentum, and for my personal preferences, i would like to see if there was a Candle pattern forming in other time frames (lower time frames). Not sure if you had a clear signal to enter into the market, I would say it was a middle risk trade. How much did you profit? Hope the opservations helpt!. And its good to see people asking for this type of advice, i might do it also.
Lets see how many answers you get
CouriousPips, first off a good trade. I used to use a very similar strategy of a double Bollinger band and the CCI to trade the mean reversion. That is from the 2% or greater deviation back to the mean hover when getting to the mean with no signs of a retracement I woul allow the trade to run as far as possible. This is a good strategy and will work on any time frame.
@midwest I did not advice him to avoid trading the News, I was only saying to check the News schedule before entering a trade. I can’t advice that as I personally enjoy trading high impact news events.
Although price has rallied back to where it was before the News, your Break even stop was definitely hit if you didn’t close.
Thank you all for great advice, it really opened my eyes and I really am going to take the advice you all gave.
Obviously, most people have a system for trading but would you consider the way I evaluated the trade inefficient?
Would you consider this a system?
And if not, do any of you trade this way? Or do you have a strict system?
It just seems that many stress finding a system, but I found trading this way - by evaluating multiple aspects - to be adequate, but is that just because I’m inexperienced?
Should I continue like this or should I really set guidelines & parameters in a strict and more systematic way?
(I hope I asked this in a way that’s understandable)
CuriousPips, it is indeed a system that will work on any time frame, the Bollinger Bands is the most commonly used indicator in the world and it is most commonly used with an oscillator.
I would suggest adding Strength and Weakness to you trade analysis along with the daily and weekly even monthly S&R levels.
Maximus, I have a different POV about fundamentals vs technicals in Forex trading and its a very cumbersome task to track them. So I keep it simple.
Sentiment plus momentum equals trend.
While I do subscribe to a few comperiest theories the forex market is the closest we get to real unencumbered trading and the sentiment is always represented in the current price.
Oh Yes!
Fundamentals are reliable. The only indicators I use are the 200 SMA on the H1 time frame and the alligator which I use for exiting some times.
I’m a day trader, fundamentals involve daily News too. Not like I always trade the News, just the high impact ones. But I check the News schedule before entering a trade so as not to be caught in the wrong side of things.
okkk i see. that’s cool though. I’m more of technical trader. It;'s just nice to see all these different trading strategies lol it’s all about what works and makes sense to you in the end
I believe it will work, you are jumping o moving throu levels, just find the right trigger for to take the trade and de right risk reward ratio. If your RR ratio es 1:2, even if you have only 50% of succes in you trades you will earn money.
m -for downtrend w-for uptrend
market rose to hit the band there should be a minor pull back but shouldn’t go below original uptrend start.
check volume for confirmation
after pull back STRONG BUY
