Hey guys,
First post (hopefully of many!). I’ve completed the course and am looking to begin another course today. I’ve been practicing trading the last week and it’s been a lot of fun once I realised my very very basic mistakes. A long way to go but I’m excited to learn more about the field of FX.
I was looking at this post in trade ideas: Entry Adjustment: AUD/NZD Short - BabyPips.com
“One the one hour chart above of AUD/NZD, we can see the pair has been in a downward channel and it’s bouncing higher after hitting the bottom of the channel post-RBNZ event. The market is very close to reaching the top of the falling channel, as well as testing the broken minor support area around 1.1050. I’ll take a shot there with my usual one weekly ATR stop and still targeting the bottom of the major range.”
How should I interpret this sentence? " I’ll take a shot there with my usual one weekly ATR stop and still targeting the bottom of the major range._"
Thank you!
I haven’t looked at the chart but the general idea here is identifying a sell entry point together with its target and stoploss levels.
The downtrend has already been identified by a downwards channel defined by lines connecting lower highs and lower lows. This kind of scenario is traded by selling when prices move up towards the upper edge of the channel and buying back when they drop to the lower edge.
The writer is saying that the price has now moved back up towards the top edge of the channel and even dropped back enough to break through a minor horizontal support level in this area - and is now rising up to test that same level from the underside, i.e. the support line has now become a resistance line.
If the price now fails at this new resistance line then a sell position will be entered with a target region around the bottom of the channel.
At the same time the stoploss will be entered which will be above the channel top line and sufficiently far above to avoid getting accidently stopped out by the normal fluctuations on the price while it is still around this level. The writer uses the ATR indicator to determine this level.
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Thank you Simple Simon!
Miraculously, that made a whole lot of sense to me - thanks for not overcomplicating it. As a result, I’ve waited a couple of hours until it bounced off of the major resistance line to
I’m still in practice mode so I’m just seeing if/how profitable vs. risky this setup could be. I’m practising my ability to create orders, stop losses, and take profit lines in areas that lead to good pips without the whipsaws. It feels like an art I’m slowly refining.
I placed a small short order at 1.1073 and another scaled short order at 1.1060 due to the significant downtrend with a hypothesis that it will reach at least as low as 1.0978 before bouncing back off of the major support line in the downtrend.
Thank you
That just about sums it up! Good 
Good luck and report back…