As a followup to the EURUSD trade I posted two days ago, if you entered on the 1Hr time-frame you’d still be in the trade showing a nice 6.4% profit (based on 1% risk).
The high test bar (circled on the right) was the entry signal as it was a double top (circled on left) and had reversal divergence on Stochastic (pale yellow lines). This coupled with the higher time-frame signals (see previous EURUSD post) gave the possibility of a great trade, the downside being this is EURUSD during Non Farm Payroll week which makes it somewhat riskier.
There was a pullback to endure, but it had massively heavy resistance above it in the form of converging daily, weekly and monthly Pivot lines (blue, green and purple respectively) so moving the stoploss above that gave a good degree of protection. The higher low which followed wasn’t really – the closes were actually lower – so it was worth keeping the trade open to see if it would bounce from the EMA’s.
The move down today was extraordinary and unpredicted, but nevertheless I’ll take it. My stoploss has now been moved to just above the Weekly S1 Pivot line (green dashed line) to protect about 5.8% profit, although I’ll take profit before close of play tonight to avoid the possibility of a weekend gap and the likelihood of a EURUSD retracement on Monday.
After a very productive September and October, November has started with a cracking trade. Let’s hope that we get a few more like this before Christmas!