Long signal

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A few days back I wrote about the CADCHF, I thought that it was a currency pair worth monitoring and it was probably a good idea to look for long opportunities.

Why I thought that?

Back then, it broke through an important resistance level, and its next LT resistance level is way up (more than 250 pips away from where it is currently trading).

Plus, it’s got clear S&R leves and clear swings.

So we’ve got the formula of a high probability trade.

The thing is this, in order to get to the point where you know what the market is likely to do, you need to do your long term analysis (which is why we arrive to that conclusion), ok.. check, we already did that…

But in order to get in the market, we need to analyze the short term charts, and we need to adapt to the market conditions and find a good entry.

And that’s what we are going to do with the CADCHF.

CADCHF Short term analysis

Take a look at the short term chart:

CADCHF 30M Chart

As you can see, it is trading in a clear range, which is good for us because this way we know exactly at what levels the CADCHF might retrace.

This also helps us determine a trading plan for it, and here is mine:

Long stop entry: 0.8287
Stop loss: 0.8250
Take profit: 0.8490

The risk reward ratio in this trade is 5.4:1, pretty good huh?

Imagine if every trade you took had this risk reward ratio?

Your turn

What do you think about the CADCHF?

Are you going to take this trade?

Do you have any open positions in other pairs?

Leave a comment.

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Raul Lopez

I've been trading the markets for more than 15 years. I believe the best way to trade is by adapting to the market conditions. You can learn it too, join our community .

  • amp888

    yes, better to wait on the sidelines. Should I look for the direction on 1H or daily chart ? very tricky …..

    • Raul Lopez

      Hello Amp, I use the long term charts to determine the market direction, once I have a clear idea of what the market is likely to do then I look for my entry on the short term charts.

      Good luck!

  • amp888

    Hi Raul, I got stop out @0.8250. Should I re-entry long again @.8210 on the uptrend daily outlook or going short @ 0.8250 on retest and pullback on 1H chart. I am not sure what direction to use on 1H or daily. On 15M/30M, the trend is reversing. Please give your comments. Thanks

    • Raul Lopez

      Hello Amp, yep, that was because of the GDP announcement.

      I think that for know we are better off in the sidelines in the CADCHF… we’ll get our chance to trade it, we just need to be careful.

      Good luck and have a great week ahead!

  • Wojtek

    Oops! It looks like it didn’t go the way we wanted it to go. I hit the SL @ 0.8250 about 12:30 GMT. I’m glad I’m out as it is still going down it wasn’t such a big loss. Was it some kind of news trading which caused that I wonder?

    • Raul Lopez

      Yep, I know… It hit the SL because of the GDP announcement… but we all should have close that trade just before the announcement because we didnt have enough room to let our trade breath!

  • Muhammad Imran

    Hi Raul,I followed your last article in which you talked about long opportunity on CADCHF.I got my entry at 8212 and currently im in 76 profit now..thanx for this

    • Raul Lopez

      CADCHF?? You mean GBPAUD right?

      • Muhammad Imran

        Oh sorry Raul, I was talking about your 15th may article in which u discussed about CADCHF..

  • Said

    Hi Raul, I checked the trade idea from my perspective and what i can read is that:

    1. it’s about a long breakout

    2. a critical resistance is at 0.8306

    3. if it breaks through the 0.306, then it’s to reach 0.8328 or 0.8334-0.8337.

    going over the mentioned price levels is questionable.

    nb. i don’t trade breakouts therefore i can’t say how it will breakout or where to place the stop loss.

    i hope these would help bring more insights into your trade.

    • Raul Lopez

      Thanks Said, it’s trading in a bullish condition and that’s the reason why I’m looking for long opportunities…

      Cheers,

  • Muhammad Ali Awan

    Hi Raul, any suggestion on CADCHF, coz I think it will go short.

    • Raul Lopez

      What makes you think it will go short???

      Buy stop order hasnt been triggered yet!!! I’m still on the sidelines but I’m still confident that it will go long!

      Good luck!

      • Muhammad Ali Awan

        Sorry I was telling you about GBPUSD not CADCHF, any suggestion for GBPUSD, coz I think that will go short. sorry once again.

        • Raul Lopez

          Yep, the GBPUSD is likely to continue its way down… its trading in a bearish condition…

          • Muhammad Ali Awan

            Good coz, I had a short trade in that, and I am still -18, so I am hoping that it should go short. Thanks to your S&R, of which I was not aware of before I read you book.

          • Raul Lopez

            No problem!

  • Eric Aroh

    Raul, thanks for the immediate feedback. WoW!.

    Following your manifesto (which I now re-read every forthnight) one should focus on price action and clear S&R. I have applied these somewhat successfully in some of my trades; but I am yearning to go deeper. It’s time I register and go through some of your indepth training courses.

    I will like to open up discussions on that (with you).
    Thanks

  • Eric Aroh

    Risk/Reward ratio is “too good to be true”!.
    Nonetheless, I will take the trade, long @ 0.8319, and with TP @ 0.8480 which a few pips below the nearest significant resistance (occured 06Jan2014). This also happens to confluence with 100% Fib Ext.

    I understand that Fib levels may not be the best tool/indicator for determining profit/loss points, but I need a confirmation tool (in addition to past strong S&R levels) to strengthen the probability of making the profit level.

    I welcome any thoughts on this?

    • Raul Lopez

      Thoughts on what? Fib??? I try to never take decisions based on subjective tools such as Fibs retracements or projections…

      Too good to be true??? I’ve taken trades with a 10:1 risk reward ratio, and it has hit my TP order… So I guess its up to the market!

      Good luck Eric!

  • Adrian Friday

    I love the risk to reward on this trade! Been waiting all week to see what it does. As long as WWIII doesn’t start tomorrow we should be ok.

    • Raul Lopez

      Pretty good RRR isn’t it? Yeah me two, It’s been in a bullish condition since last week and just now we have an opportunity to profit form it!

      hahahahah No, no WWIII on the horizon… for the moment.

      Good luck Adrian! And good to see you here…

  • tp

    Hi, I will take this trade! :)

    • Raul Lopez

      Good luck TP!!!!