$EURUSD-Banking on a False Breakout? - Working with Levels (SMT)
Updated
Yes, I know my chart looks Sloppy, but when you analyze the 5min chart for price action, it's going to look that way. Now...
First Piece to this puzzle DXY RSI divergence with Price Action. Looks like we should see a bullish Dollar after breaking a new low. And I wouldn't trade this Until we have confirmation that it does break a new low and/or comfortable with the fact that we can confirm a bullish dollar. Otherwise this trade will be a waste of money and time.
Second, there are baked in unseen natural support and resistance prices that take place at the 0 ,2 ,5 ,8 levels. We say this last time when EURUSD dropped good ways from when it hit 1.18800 a few weeks ago. So therefore I have a few levels in place anticipating such action. 1.195, 1.198 nd 1.2, Where the previous high was reached. If I get a 30 pip drop from any of these levels, I think it would be wise to pay yourself and move stop loss accordingly after doing another evaluation to mitigate losses. Check to see if the low has been broken and where this falls in comparison to the baked in Support/Resistance levels. I would personally trade the false breakout at that point depending on If when it happens.
Third, Yes, we did break a high, yes the 4 HR and Daily are possibly going to have a closed candle above the "Resistance." Does that guarantee a breakout? Usually.. never. It takes time to build out from the Market Maker Buy/Sell Model and I believe we're at the top or nearing the top of a sell.
However, I'm not sure it would be in my best interest to trade this on a Friday. Or Monday for that Matter. However, if you're a swing trader, you can definitely use this as a False Breakout set-up. Multiple levels on the left where price action has occurred previously that may result in a reversal so these are key levels at which I like to analyze when reach and see if there is a need to take profit or not.
We shall see as price moves along throughout the day, I'll be watching the DXY and the EU to see if I would pull the trigger.
I could be completely wrong about this, but what do I know. I'm just some guy who likes to post his ideas.
Good Luck and Good Trading.
First Piece to this puzzle DXY RSI divergence with Price Action. Looks like we should see a bullish Dollar after breaking a new low. And I wouldn't trade this Until we have confirmation that it does break a new low and/or comfortable with the fact that we can confirm a bullish dollar. Otherwise this trade will be a waste of money and time.
Second, there are baked in unseen natural support and resistance prices that take place at the 0 ,2 ,5 ,8 levels. We say this last time when EURUSD dropped good ways from when it hit 1.18800 a few weeks ago. So therefore I have a few levels in place anticipating such action. 1.195, 1.198 nd 1.2, Where the previous high was reached. If I get a 30 pip drop from any of these levels, I think it would be wise to pay yourself and move stop loss accordingly after doing another evaluation to mitigate losses. Check to see if the low has been broken and where this falls in comparison to the baked in Support/Resistance levels. I would personally trade the false breakout at that point depending on If when it happens.
Third, Yes, we did break a high, yes the 4 HR and Daily are possibly going to have a closed candle above the "Resistance." Does that guarantee a breakout? Usually.. never. It takes time to build out from the Market Maker Buy/Sell Model and I believe we're at the top or nearing the top of a sell.
However, I'm not sure it would be in my best interest to trade this on a Friday. Or Monday for that Matter. However, if you're a swing trader, you can definitely use this as a False Breakout set-up. Multiple levels on the left where price action has occurred previously that may result in a reversal so these are key levels at which I like to analyze when reach and see if there is a need to take profit or not.
We shall see as price moves along throughout the day, I'll be watching the DXY and the EU to see if I would pull the trigger.
I could be completely wrong about this, but what do I know. I'm just some guy who likes to post his ideas.
Good Luck and Good Trading.
Trade active
It tagged that sell-side breaker as soon as it touched the low. I think that's a good indicator to jump in the sell and I did at 1.96. Still a possibility it could go high and the low could be broken so I didn't grace it will 2% of my account, just .5%. I'll be watching my S/L's and possible second entry as the day moves on. But I think we're going to consolidate above the high for rest of the day, giving the sense of a breakout moving into next week. But I don't think that will be the case.(EU Entry)
(DXY)
Note
Holding two positions over the weekend. 1.19440 and 1.19590Trade active
Alright so while I'm looking at this Asian Range, already I see 3 equal highs. Giving a sense of resistance. However, there is still an order block/breaker just above that at 1.19769. I would be surprised if retail thinking is to sell now and put a tight stop loss just above where the "resistance" is, creating liquidity in that area. I'm thinking it's going to easily break those highs before hitting the bearish order block/breaker at the level mention above before it's actual drop. Trade active
As expected, after the Asian Range was completed it broke the highs and touched the tip of the breaker before retracing. The DXY is showing signs of bullish improvement, we should see the EU start to fall from hereTrade active
Knocked out of my first position. Second position deep in reds but I added another after it touched the last breaker and started retracing. at 1.19826 with a 30 pip sl and goal set for 1.19145. It's finally retracting so I think my last entry was the best call. And I should've been wise enough to wait instead of putting some faith in on Friday. Note
GU may be the fast mover now, but I think in a few hours EU will be catching up to it's dropping speed.Trade active
Ok, it spiked a bit harder but I was prepared. We did lose one position at about 38 pips. However, with the two remain entries we gained 33 pips on one entrance and 53 on the second if you exit at 1.9450 which it's extremely close to now. Take 50% of all lots here for both positions. and to minimize risk, go ahead and remove stop losses and put them at break even. The lower entry may get taken out so if you feel it's for you, take 100% of your lot sizes here. But the higher entry, just move to break even.Note
Being realiztic about this, if it is to continue going down, we should see a pull back prior to. That pull back would probably be above the second entrance. but not the third. So if you feel like putting you second entries stop loss at the third entry, you'd be risking another 20 pips with 50% of you lot totals (that you just banked 33 pips on so if you lose this you would still come out on top 13 pips ahead on the second position. But that's where I see the pullback headed to before making a shorter move. Next Take Profit level another 30 pips or so at 1.19145 Note
Watch and wait closely, we may be close to taking TP-2 than we thought.Note
Note
Maybe take a smal 5%-10% at 1.192300, its at the 127% extensinoNote
Yes do it . Take 15% at this level. Its another 70 pips and 50 pips. It could retrace back and disappear before the Asian session.Note
Just remember we still have 35% of our lots left to distribute. And definitely removed both stop losses to break even now. On the reverse side. That 127% extension is also the 62% retracement if you're looking at it from a bull perspective. So that's why I thought it was import to have a small payment to yourself then and remove all Stop losses to break even. Trade closed: target reached
So before I went to bed last night, I had a feeling this was not going to turn towards out sell Bias direction. I set my target to just below it at the time 1.19620. So for position one that was 16 pips, and position two was 37 pips.All in all two profitanly positions. Position one had 98 pips total. With 50% of the lots taken at 33 pips, 15% at 49 pips, and 35% at 16 pips. The second Position had 162 pips with 50% of the lots taken at 55 pips, 15% at 70 pips, and 35% at 37 pips.
That's not counting the buy I put in at 1.19680 to 1.2000 just now. I saw that coming when it changed from sell to buy bias.
Anywho, thanks for following this trade and I hope we all gained something from it.
You're either trading with Smart Money Theory or your just burning your money money. Believe me, I've been there.
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