Hi all,
I’m a Forex newbie. 
I thought I was doing well up until yesterday. I shorted USD/CAD at 1.0400 and thought it was a good move. Then after, as I’m sure you know it moved up over 1.0500.
My rationale for the trade was semi-weak US economic data yesterday and a resistance level which seemed to be pinned to 1.0400.
First off, do you think I should hold?
Second, what signals or indicators did I miss which could have averted me from entering a trade like this in the future?
Sean
why would you short when the overarching trend has been upwards lately? economic data reports may produce sudden swings in one direction, but that doesnt mean it’ll become a pivot point for the prevailing trend.
Hi Sean,
Ya, that’s tough, and why I don’t get into fundy’s too much…what one thinks should happen, doesn’t. To hold or not to hold…hmmm…lol. If you hold, it could get worse, if you don’t you could take a bigger loss than if you held and it retraces back to your entry. These are things to think about before putting on a trade. Did you even set a stop loss?
As for resistance, there was a little there but by zooming the chart way out, I’ve marked in grey horizontal zones what seems like areas of supply (resistance) & demand (support), and 104 (left white circle) just didn’t seem to have enough going for it (a 50ish pip bounce if got in early).
I’m looking at 1.0560 (middle white circle) area myself for a bit of a bounce, but otherwise it looks like price is heading up for a double top there at the blue line (right white circle).
The 1.0560 is the weekly pivot R3 level, extreme, 88.6% fib of top to bottom, R2 on daily pivot, 161.8% fib extension of previous daily range, and if it reaches there today it will have moved the average daily range…lots of confluences. Even with all that is could still fail, so my stop is set just above the supply zone where I’d consider the supply zone breached and will try again at the next level.
I would suggest looking into supply & demand strategies like Intro - my weekly high probability trade analysis video 1 - YouTube eremarket here on Babypips.
