Last week I made a multiple time frame analysis on the USDCAD. All charts were pointing up and I thought it was a good idea to look for long opportunities.
Guess what? Since then, the USDCAD has been going up :)
Last week I got a few emails asking me if I’d close my trade over the weekend and last Fridays CAD news announcements (I think it was the CPI)…
My answer was no. I’ve talked about it in the last few weeks, how I’m going to handle news announcements this year. In essence its like this:
I’ve noticed that when there is an important fundamental announcement, most of the time the market will move in the direction of the market condition. I always trade in the direction of the market condition, so if I have enough pips to set my SL to the break even level, I’ll always let my trades run, even during the most important ones.
Here are a few of the currency pairs I’m currently monitoring.
On some of them I’m already trading/looking for a trade opportunity, while on others, I need to wait for the market to do “something” before I start looking for a trade opportunity.
But there is something in common on all of them: CLARITY.
Clarity trumps everything in forex.
What do I mean by clarity?
It’s how clear the analysis of a currency pair is. Is it clear that the market will move up? or down? Or I have absolutely no idea of what the market is going to do?
Of course, if there is no clarity, there is no point on trading that particular currency pair, you have no idea of where it is heading right?
Clarity is so important when trading the forex market, that it can help you get good results even when you don’t have a good entry system, patience, etc.
Yesterday I was doing a lie webinar at FxStreet and one of the assistants reminded me of something, which could be the essence of trading, he said something like this:
Trading is about finding the right opportunity, with the lowest amount of risk.
He is totally right!
About Risk and Trade Opportunities
We have hundreds of currency pairs, thousands of opportunities each day. So our job as traders is to fin the right one or the right ones to trade each day.
Now, we need to understand something though.
There will alway be risk. It is something we need to live with as traders. There is no such thing as a risk free trade.
So embrace risk, learn to live with it… I guarantee that once you feel comfortable with it, comfortable about the fact that each trade has the possibility to go against you, you ‘ll begin to see more and clearer trade opportunities. As I said, I guarantee it.
The GBPUSD got rejected from an important long term resistance level. And as you already know, when the sentiment of the market is bearish, only short opportunities should be in play.
Here what the short term chart looks like:
I’m curious about what currency pairs you’re monitoring, please share them in the comment section and don’t forget to add which direction you are trading (long/short).
One of the pairs I’m currently monitoring is the GBPUSD, it’s daily chart is as clear as water.
Here is the chart:
It was difficult to trade the last upswing in the GBPUSD, mainly because we didn’t have a clear resistance level where I’d feel comfortable with.
But now, it seems like everything is clear enough, take a look at the daily chart and you’ll see that it is being rejected from the same level, 2 rejections = 1 resistance level :D
Here is the short term chart:
I don’t know about you, but I like to trade the pairs that have clear levels, on both, short and long term charts.
Having clear levels on the long term charts helps me determine which way to trade, and also clear S&R on the short term charts helps me determine possible entry levels.
But take a look at this GBPUSD chart:
Hope you all had a great weekend!
Are you currently monitoring the GBPUSD?
I am, I really think it’s good time to start looking for long opportunities, and this chart agrees with me:
It has been rejected from the bottom of the range, and looks like it will continue its way up until it reaches at least, its next LT resistance level.
Now, on the short term charts, as long as it trades above 1.5428 I’ll be looking for long opportunities.
Let me know what you think.
Hope you all had a great weekend.
What currency pairs will you be monitoring this week?
One of the currency pairs that I like this week is the GBPUSD, earlier today it broke through an important support level, triggering a bearish market condition:
See how it is trading below the support level? I’d definitely feel comfortable shorting the cable.
What do you think?
Good luck for the week ahead!
Yesterday I wrote about the GBPUSD, it was trading in a clear short term range. What I thought was interesting about the range is that it was formed near an important LT level. This means that once the market breaks the range, I’ll trigger a clear market condition, and this is what happened:
Yep, it broke the upper extreme of the range. This puts the GBPUSD in a VERY clear bullish market condition.
On easier words: I’ll be looking for long opportunities.
What do you think about the GBPUSD? Let me know.