EURUSD Yin and Yang
Updated
As you may see on my chart, there are multiple upward and downward trend channels that take action in different time dynamics. Now it's hard to say whether the EUR will return to the levels above 1.10, and if so, whether this will happen more quickly, or it will be slowly and gradually, changing different upward and downward channels on its way.
You may use the lines I've drawn as virtual support and resistance lines for a return of the EUR to the upper grounds...
My positions are long, and I hope the EUR will not test too much my nerves with short flirtations downwards. If so, I would try to escape the situation with pending sell stop short position (as an implied and flexible stop loss strategy) that is 1.8 times bigger than my long position, and that is somewhere at 1.09180, and thus I hope to stop losses, and minimise them in cases of stronger push downs of the fx rates.
Nevertheless, mind well, this strategy is a risky one, and I apply it experimentally for some time. In any case, if you do something like this, please, mind well your minimum requirement for margin level. Then calculate your margin as the difference between your short and long positions, and multiply this by the minimum margin level ratio. For example, if your minimum requirement for margin level is 65%, and the difference between long and short positions is Margin=1,000-1800=800, then in the worst case you will end with a loss equal to Balance-800*0.65, or your end result will be 520... ;-) Of course, you may try to navigate closing your short and long positions, trying to stay above the 65% ratio, and hope for good luck to navigate out of the mess that you've created on your trading platform ;-) Cheers!
You may use the lines I've drawn as virtual support and resistance lines for a return of the EUR to the upper grounds...
My positions are long, and I hope the EUR will not test too much my nerves with short flirtations downwards. If so, I would try to escape the situation with pending sell stop short position (as an implied and flexible stop loss strategy) that is 1.8 times bigger than my long position, and that is somewhere at 1.09180, and thus I hope to stop losses, and minimise them in cases of stronger push downs of the fx rates.
Nevertheless, mind well, this strategy is a risky one, and I apply it experimentally for some time. In any case, if you do something like this, please, mind well your minimum requirement for margin level. Then calculate your margin as the difference between your short and long positions, and multiply this by the minimum margin level ratio. For example, if your minimum requirement for margin level is 65%, and the difference between long and short positions is Margin=1,000-1800=800, then in the worst case you will end with a loss equal to Balance-800*0.65, or your end result will be 520... ;-) Of course, you may try to navigate closing your short and long positions, trying to stay above the 65% ratio, and hope for good luck to navigate out of the mess that you've created on your trading platform ;-) Cheers!
Trade active
The virtual stop-loss strategy with a short sell stop position has been activated at around 75% margin level, at fx rate 1.09130. I have just closed my 80% of my short position, landing at around 85% margin level. Now what I want to do is to close the rest of 20% of that short position somewhere around its opening price, securing my margin level around 80%, and wait for an upward trend. In any case, I put again a sell stop pending order for a bigger amount than my capital as a virtual stop-loss strategy at 1.08929. But hope that won't be the case. Anyway, we can't survive on Forex without taking risks ;-)Trade active
I am taking notes on my experiments with the trading platform and my real account sessions, and post some meditations on that website, hoping to help others who really try hard to learn something precious about the relativity on forex market. I'm trying to solve the following question. Let's abstract ourselves from our successful trades, when we have hit the jackpot, and when we see our equity grow, when we may set some minimum requirement for tp, and just enjoy our day watching the fx rate. The problem comes, however, when we are on the other side. We've made a trade, but we see that the fx rate goes gradually into the opposite direction. How long should we wait in that situation, should we hurry to sl, or we should think of something more flexible, we should keep that position, no matter that its negative, and open another one, an opposite one, that will compensate the momentary fluctuations we experience. If we manage to hit the right proportion between the sizes of the "mistaken trade" and the "opposite trade", we may not only manage to escape from unpleasant losses due to the unpleasant behaviour of the market, we may also not only manage to compensate to a great extent the negative result that tortures our "mistaken trade", but we may successfully wait safe and sound until the reverse, and then finish out "mistaken trade" on the right side, and finish our adventure very pleasantly.
Actually, I have the feeling that many people think that technical analysis makes their profits. Technical analysis is just analysis, it is not the real trade. Technical analysis and all other market analysis used for trading should give just general directions, meaning general ideas about possible trends, general ideas about possibility and relativity. After we've considered the analyses, however, it's time for the real trade, where ideas may bring or may lose money. Important is that we are as careful and technical with our trading sessions, as with our technical analyses. Actually, analyses are build on assumptions, while our trading is based on actions - buy and sell. While we cannot say we can be 100% precise when we make assumptions - and that's why we always speak in broad terms (also quite vague sometimes), drawing some channels, using different subjective interpretations about history-based statistical indicators, and relatively remote support and resistance lines, and etc.; our trading session is precisely conditioned in accordance to very strict trading rules, that work with very clearly defined mathematical equations...
We don't sell and buy our technical analysis. We only may use it to improve our trading session in the continuity of time, as it may give us ideas of the bigger picture, or the consecutive waves, as described by Elliot. Nevertheless, as most of us trade intra-day, we usually don't have the time and also the financial resources to wait until our expectations for the bigger picture get true, because sometimes this may happen in 1 month, even in 1-2 years. And even if we can wait until then, a momentary volatile caprice of the market, due to some market shock, financial or economic crisis, may kill our trading session just a moment before reaching our final destination.
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