Monday, December 12, 2011

My Eurusd trade, currently up +190 pips.

Let me start by saying I actually entered this trade on Friday going into the weekend, but hey I had my reasons lol. I have been waiting for the opportunity to go "anti-euro" for a while ever since it struggled to get above the 100 ma (black) cleanly. It found resistance in the .3500 area and shot  back down for a nice engulfing bear candle (arrow 1). At that point I was looking to get under the .25% deviation envelope of the 50 ma (blue). I actually entered first at the close of this trendwall and 50 ma break (arrow 2) and got stopped out from market reaction of the European summit, probably shorts covering ahead of the weekend. I lost 100 pips, ouch! Eh o well, on to the next trade. I decided to play the bounce off of the lower envelope band of the 50 ma considering the fact I could get a good R:R still being below the 50 ma and below this nice trendwall (arrow 3). I figured if the summit proceeded as optimistically rumors had it, we would definitely have seen a bigger jump IMO; the market simply struggled. I got in and with the news of today's Moody's credit downgrade possibility,  rode with the bears down to .3200 -.3180 where there's monthly trendwall action. This is the same trendwall I have had my eyes on since before Thanksgiving. I have seen as much as 200 pips but took profits 180, not bad. I closed half and I'll wait to see what price action tells me. If I don't see any bearish action next London session I'll probably pull out, if not, I'll ride down some more.

I wouldn't expect eur/usd to nosedive like it did in the beginning of January, but the way things are going now, I wouldn't be surprised.

Sunday, December 4, 2011

What I'm seeing from Eur/usd

I was able to enter long when we first crossed back above the 50 MA. We also broke out of this trendwall located at arrow #1 and as you can notice came back and tested that same trendwall with a nice wick (arrow 2). I am also keeping in mind the fact that that wick was formed this past Friday which could have resulted from sellers covering their shorts before the weekend. You can see the market completely stalled at the 100 MA while also breaking back under this daily trendwall (arrow 3) that I drew a little before Thanksgiving. While its above RSI support on the 4Hr,  it is currently coming off of the daily RSI resistance. So far my trade isn't looking how I would want it to but nonetheless I won't pull out until my SL is hit. At that point, I'll be ready to flip my position and go short.. I have some psychological support at .3400 but I definitely don't think that will hold very strongly. The signals are there for this to continue its advance to 38.2, but I'm focusing on this EU summit to hopefully meet in a positive manner in order for the market to make these moves.

Here's a view of the daily chart to let you view the market getting back under the daily trendwall mentioned previously. This is bearish in my eyes despite my position however when my setup presents itself, I must take it. If no positive progression comes out of Europe, this might be the driving factor that will take us back down to the monthly trendwall that I have been eying for a couple of weeks now (arrow 2). If that does happen, I will be ready to enter short and ride the wave.

Here's a quick view of the monthly chart to let you view the trendline I drew and mentioned in my last post.

Saturday, November 26, 2011

My First Blog Entry - My Eurusd second entry short

I entered my short trade once we got a solid close back under the 50 MA on the 4 hour chart. I enter my positions based on the 4 hour chart. I use moving average envelopes of .25% deviation which helps me determine the strength of the move away from the moving average. I usually aim for 200 pips while risking 75-100 depending how much support/resistance my stop is below/above. I noticed .3450 was particularly a solid support area that I wanted to see break before any attempts for price to continue down.

 Looking at the monthly chart, it is in the range of this flag pattern heading for support. As I entered my short entry, I appointed my target as the lower trendwall which would give me my the 200 pips I try to achieve and then some. .3450 was an area that was receiving a lot of attention since this was the probable gateway to that lower trendwall.

 Looking at that monthly trendwall on the weekly chart, we can see that last weeks price action down leaves the trend line exposed to AT LEAST be tested. It looks like I will reach my target and I will most likely close the rest of my position at that point. By that time, the 4hr RSI will be oversold and the Daily RSI will be at a value really close to 30. Therefore, I'm going to expect a pullback that I might be able to ride up before another move down. If I can get a long entry at a good price once I get a close above the 50 MA, I will have a very strong support area for my stop loss to be under. After all, I will be doing what every trader does, buying at support and selling at resistance in which this case I will become a buyer. Hopefully my first blog entry was helpful and understandable, for you will read a lot more from me.