G’day from hot and sunny Sydney… I never traded forex before but used to trade futures & options many years ago. I took a very nice ride down the falling AUD/USD wave early this morning on the strength of a price - MACD divergence on the 1 day timeframe. I bought well, sold well, happy-happy. This afternoon I see a strong price - MACD divergence once again, and what looks like a possible double bottom forming. To me it screams buy, which I did momentarily but sold at break even, when the fledgling rally lost puff and faltered back to my opening price. I considered re-entering the trade but can’t quite reconcile buying into such a strong sell-off as displayed on both the 15 min and 4 hour charts (attached). Sorry my charts are a mess but I threw up all the heavy guns looking for reassurance that I should buy but in the end I walked away scratching my head. Any thoughts on this (setup?) / situation would be appreciated. Does the lower time frame make signals like divergences less relaible? Cheers Looks like I can’t upload my charts since I’m a new user…
BTW the divergence signal occurred on the 15 min chart this afternoon. It was obvious on the chart, which I couldn’t upload…
I can probably answer my own question now, two hours later. The market is roaring northwards and it looks like the price - MACD divergence was a valid signal. Guess I’ll know for next time…
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