I'm back now, hopefully better able to understand and predict the emotional swings of the market!
So, today, since I really, really wanted to take a trade, I looked at one of my old standby's, the British pound - hmm, looks like the GBP/USD was just waiting for me to wake up and take a look at how much the market has moved since I last traded - this instrument is trading way higher than I remember.
So, here goes the analysis:
Hourly (trying to spot a trade):
Looks like the 10 EMA has just bounced off the 25 and 50 - a good trade entry! Also, we're just about to cross upwards into the 61.8-78.6% Fibonacci area - another very good sign there.15-minute (confirming the parabolic SAR):
Okay, the parabolic SAR (the little dots) are indeed still indicating a bullish trend.Daily (additional confirmation on trend):
And so is the Daily chart. All systems go! Time to pick my stop and limit.I want to put the stop low enough to not be stopped out too easily by a minor retracement. I also don't want to test the resistance, so I'll be conversative when I set up the limit.
Okay, got into this trade at 10:01 a.m. Bought at 2.0406, with a stop at 2.0362 and a limit at 2.0425 (I think it may well trend higher, but this will be a significant profit anyway).
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Today, I was unable to watch the trade as closely or as often as I'd have liked (it was a work day again). But, at 11:36 a.m., I got email: the limit had been reached and had triggered a sale of the micromini lots I'd bought. Yay! I guess my middle name no longer needs to be stopped-out!!
Further analysis shows that I'd read the Fibonacci Retracement fairly accurately: I could have set my limit several pips higher, but I think (believe?) I knew that when I set up the limit - I'd realised that it may actually trade higher, but had set a lower profit target because I tend to get antsy. As I'd expected, it certainly didn't make it to the 78.6% Fibonacci level. I walked away with a 19-pip profit. Not so bad!
Okay, I'll be waiting eagerly for trading to resume on Sunday evening. In the meantime, I'm going to go back and re-read the class notes (haven't had class for a couple of months now, due to some upheaval in the class providers' schedules and arrangements).
