EURUSD: Will Support Hold? – Closed Trade

Stopped Out: 2010-08-12 2:49

PoD Chart

Yeah, I lost. Boo hoo! Even though I was right about the FOMC engaging in quantitative easing measures, it wasn’t enough to really weigh down on the dollar. The problem with my trade idea is that I didn’t factor in the reversal in the market’s sentiment from risk appetite to risk aversion. I was only up by 58 pips when EURUSD reversed and headed down the charts. Eeek!

I guess I should have moved my stop loss to breakeven when I had the chance to. Sigh. But don’t worry, this 130-pip loss won’t stop little ole me from checkin’ out hot set ups on the charts. Skadoosh!

Stopped out at 1.3040 for -130 pips / -1.00%

Trade Idea: 2010-08-10 2:56

PoD Chart

Well, hello euro! I couldn’t ignore that sexy long-legged doji hangin’ out on the minor resistance level at 1.3130, hollering at me to go long. So yeah, I’m buying the EURUSD but not until it reaches 1.3170. I’ll wait for the pair to gain some momentum first and ride the wave.

I went through Pip Diddy‘s blog today and I found out that the FOMC is due to talk later. For those of you who don’t know yet, that is an OMG-worthy event even though it’s no surprise that we won’t be hearing any rate hike from the Fed. Boo hoo! They may talk about quantitative easing and that’s where things could get crazy!

However, I’m hoping that the market will shoo away risk aversion that could come knockin’ when the FOMC expresses its pessimism on the US economy. I’m looking forward to a repeat of NFP Friday when the bulls looked past risk aversion and focused on the Euro zone, which seems to be in a better shape than the US. So let’s go euro!

On the technical side of things, I noticed that EURUSD seems to have found support at former lows. With a long-legged doji forming, I believe the retracement could be over. I’m not going to jump in just yet though! I’ll wait until upward momentum picks up before I enter. I’ll ultimately target 1.3500, but I’ll take some profits off the table at former highs at 1.3300.

As for my stop, I have placed it 130 pips away, roughly equal to the pair’s average true range. Hopefully, my stop will be enough to survive the crazy volatility tonight brought about by the Fed’s interest rate decision.

Long EURUSD 1.3170, pt1 at 1.3300, pt2 at 1.3500, sl at 1.3040.

That’s my trade idea for this week. If this trade gets invalidated tomorrow, I will close my orders and find opportunities elsewhere. Don’t forget to follow me on MeetPips.com too!

  • Gildo

    Hello Lady of the Pips!

    I follow your blogs all the time and I love them!

    I thought you only use your HLHB strategy but I can see you also know/use the doji strategy…

    I am a newbie and I’d much like your help on many things. Hope you’ll help me! Two questions below:

    1) In your HLHB, it seems the EMA’s can be either 10 on 20 or 5 on 10. I’d like to confirm if that’s ok. Also, let me know whether I can use them on any timeframe.

    2)Talking the EUR/USD above, why did you wait for the price to move 40 (1.3130 to 1.3170) to go long?

    Thanks in advance.

    Gildo

  • Gildo

    Oh By the way, HLHB won me 50pips last night!

    Forgot to mention that

    Thanks.

    Gildo

  • Huck

    Hi Gildo!

    I’ve been trading for only one year, but I still consider myself a newbie. There is much to learn and I think I have a long way to go before I reach Pipcrawler status! That being said, I’m a newbie just like yourself!

    1.) I haven’t tested the HLHB system on other time frames, so I don’t think I can answer that. However, I have backtested and forward tested the HLHB system heavily on the EURUSD (4-hour timeframe) and it is profitable. Feel free to test it on other time frames though! And oh, inform me of your results!

    2.) I waited for EURUSD to hit 1.3170 before going long because I thought if price headed that way, it would give bulls enough momentum to take price higher. Buying at market seemed risky when I made the trade so I decided to wait for additional confirmation… For price to go above the high of the doji candle.

  • Gildo

    Hello Lady of the Pips!

    I follow your blogs all the time and I love them!

    I thought you only use your HLHB strategy but I can see you also know/use the doji strategy…

    I am a newbie and I’d much like your help on many things. Hope you’ll help me! Two questions below:

    1) In your HLHB, it seems the EMA’s can be either 10 on 20 or 5 on 10. I’d like to confirm if that’s ok. Also, let me know whether I can use them on any timeframe.

    2)Talking the EUR/USD above, why did you wait for the price to move 40 (1.3130 to 1.3170) to go long?

    Thanks in advance.

    Gildo

  • Gildo

    Oh By the way, HLHB won me 50pips last night!

    Forgot to mention that

    Thanks.

    Gildo

  • Huck

    Hi Gildo!

    I’ve been trading for only one year, but I still consider myself a newbie. There is much to learn and I think I have a long way to go before I reach Pipcrawler status! That being said, I’m a newbie just like yourself!

    1.) I haven’t tested the HLHB system on other time frames, so I don’t think I can answer that. However, I have backtested and forward tested the HLHB system heavily on the EURUSD (4-hour timeframe) and it is profitable. Feel free to test it on other time frames though! And oh, inform me of your results!

    2.) I waited for EURUSD to hit 1.3170 before going long because I thought if price headed that way, it would give bulls enough momentum to take price higher. Buying at market seemed risky when I made the trade so I decided to wait for additional confirmation… For price to go above the high of the doji candle.

  • Buckscoder

    A doji at bottom is not worth much. Oversold and Overbought at indis are not worth much. 1h chart is not worth much (very noisy on eurusd). Plus: The eurusd had a rallye from 1.18xx to 1.3333 without a big consolidation or retrace. A retrace is overdue. Best part of all: On the monthly my special indi shows that eurusd has a long term bearish trend now. Will it ever climb to recent highs again or will it just continue it’s downward roller coaster move?

    If your system works – stick with that and don’t try too much losses aside. Or look for shorties in the short term. ;)

    Just my 2 pips.

  • Buckscoder

    Oh I forgot: The lower trendline channel line of this big move up got broken on Monday. Trendlines are king.

  • Buckscoder

    A doji at bottom is not worth much. Oversold and Overbought at indis are not worth much. 1h chart is not worth much (very noisy on eurusd). Plus: The eurusd had a rallye from 1.18xx to 1.3333 without a big consolidation or retrace. A retrace is overdue. Best part of all: On the monthly my special indi shows that eurusd has a long term bearish trend now. Will it ever climb to recent highs again or will it just continue it’s downward roller coaster move?

    If your system works – stick with that and don’t try too much losses aside. Or look for shorties in the short term. ;)

    Just my 2 pips.

  • Buckscoder

    Oh I forgot: The lower trendline channel line of this big move up got broken on Monday. Trendlines are king.

  • greenlantern0

    Yeah, I’m thinking eur/usd has the potential to go lower to around 1.278. Then come back up to around 1.2999… and then continue to fall. Maybe to 1.00769 …

  • Gildo

    Hey Kiwi!

    The results are awesome!

    I have demo traded since monday and Boy oh Boy does HUCKIE relly LOVE HER BUCKS!!!

    Being a newbie in babypips pre school, I am demo trading 15 minute charts, trying out the 1 hour and 4 hour charts just to confirm trends.

    I am doing EMA 5/10; RSI 14; Stochastics having same direction and things have gone wrong only once. I think it was a fakie… Rating HLHB on a scale of 1 to 10… it has performed 9/10 so far, but methinks it deserves 11/10!

    As we speak, I am setting up my platform for alarms to help me not keep glued onto the computer. Hope I will guide any day-olds with my set-ups soon!

    My next lab rat will be your doji in overbough/sold.

    Go Uganda!!

  • greenlantern0

    Yeah, I’m thinking eur/usd has the potential to go lower to around 1.278. Then come back up to around 1.2999… and then continue to fall. Maybe to 1.00769 …

  • Gildo

    Hey Kiwi!

    The results are awesome!

    I have demo traded since monday and Boy oh Boy does HUCKIE relly LOVE HER BUCKS!!!

    Being a newbie in babypips pre school, I am demo trading 15 minute charts, trying out the 1 hour and 4 hour charts just to confirm trends.

    I am doing EMA 5/10; RSI 14; Stochastics having same direction and things have gone wrong only once. I think it was a fakie… Rating HLHB on a scale of 1 to 10… it has performed 9/10 so far, but methinks it deserves 11/10!

    As we speak, I am setting up my platform for alarms to help me not keep glued onto the computer. Hope I will guide any day-olds with my set-ups soon!

    My next lab rat will be your doji in overbough/sold.

    Go Uganda!!

  • weelp

    It’s like 2008 all over again. I will never understand why so many people see the dollar as a safe haven when the U.S is in trouble. Now the Yen is a safe haven? What is going on!?

  • businessman78

    I got the whole move from 1.3150/70 or 1.32 I don’t remember exactly because I don’t have a chart in front of me, but I was using trend lines. I don’t know why you got stopped out. Just waiting now for confirmation of the 127.30 or so of the trend line I draw to see if it will break lower or will rebound so I can enter long and catch the move early again. Good Luck!

  • weelp

    It’s like 2008 all over again. I will never understand why so many people see the dollar as a safe haven when the U.S is in trouble. Now the Yen is a safe haven? What is going on!?

  • businessman78

    I got the whole move from 1.3150/70 or 1.32 I don’t remember exactly because I don’t have a chart in front of me, but I was using trend lines. I don’t know why you got stopped out. Just waiting now for confirmation of the 127.30 or so of the trend line I draw to see if it will break lower or will rebound so I can enter long and catch the move early again. Good Luck!