This morning I was looking at GBP/USD (What I am focussing on).
I put in a Buy order as I thought it would be a bullish turn – i got it wrong. Buy point is at the 5th candlestick from the right, sell point (stop loss) is the red candlestick at the most recently finished hour.
Buy Price:1.24305
Take Profit:1.24755(45 pips)
Sell Price:1.24036(27 pips)
(didn’t do a RRR 1:3 because I was a bit unsure with my confidence). Part of me wonders if my buffer of 27 pips was too small?
This is why I did it:
Thought I saw a falling wedge pattern(suggesting bullish turn)
Support band was in place(hard to fall past)
RSI value was sitting just a fraction above the 30 level of RSI(suggesting bullish turn)
I wonder if I was a little early,and maybe the GBP will rise later?
Given the buy point (noted on the chart at the 5th candlestick from the right) what signals would you have used that would have told you to wait, or be sure the price would continue to fall given my insights above?
**Update - I got it very wrong! The bearish trend continue!! Wow.
What does the trend on the D1 and H4 charts saying? Are they currently bearish or bullish? If they’re bearish I would stick to placing short orders rather than long orders.
Also, if you’re using the H1 to put in your orders I would agree that 27 pips isn’t a very big buffer.
The most likely thing price will do in a trend is continue the trend. The least likely thing would be a reversal into the opposite trend. But reversals are worth playing because price’s movement into an opposite trend can be very powerful, and the holding period can be short (which in theory reduces risk).
Selling live into a downtrend is not likely to be a loser. Setting a pending buy order well above the trend is not likely to lead to a trade, but if it does, it could be a dramatic winner.
I would never place a trade just before london session opens up. Look at the volume spikes at 8 and 9 GMT+2. If trend is changing, then probably with those big market participants who are coming in.
I trade often against the trend, too. But only with pending orders which i place above the most recent high. I never try to catch a falling knive.
hey, the first 2 hours in the morning of EU-Ession are in 90% of cases totally different as the rest of the (european) session. don’t trade this pair before 9:30 am.
a setting of 14 means 14 candles are taken into the calculation of the value. if you set your rsi at 10 only 10 candles will taken for calculation. so using RSI14 @H1 means you see will see a RSI value of the last 14 candles (=last 14 hours (H1))
I uses sometimes a RSI55 @h1 so i see 55x H1 candles and a “weekly situation” of oversold/overbought market.
you can leave the default settings for most indicators when using d1 or h1. but if you use another TF you should adjust the settings so you can see the data which really matters to you. I mean whats a RSI14 @M1? you will only see the condition of the last 14 minutes and this would equal noise
