You could say this week was a “fair” one. While I did lose on my EUR/USD trade yesterday, the HLHB Trend-Catcher on the hourly time frame is off to a promising start! Not only did it generate a valid signal, the trade turned out to be a winner too!
Truth be told, I really didn’t have my hopes up that I would get a valid signal from my system. I’ve gotten my crushed a couple times too many because the Trend-Catcher failed to generate any trade for a few weeks on the 4-hour time frame.
If you’ve been keeping up with my updates, you’d know that it was actually the primary reason why I decided to apply the system to the 1-hour chart. So I was quite surprised when the crossover happened and the Average Directional Index (ADX) was above 20 and Relative Strength Index (RSI) was below 50.
The first profit target at 1.4332 was hit too as price plunged a little over 150 pips over the next couple of days. I’ll keep you posted on where the remaining position closes.
However, despite this positive turnout, I’m still not head over heels with my system. For the upcoming week, I’m gonna continue to forward-test the Trend-Catcher on the 1-hour time frame to see if it will generate more profitable signals.
As for my EUR/USD trade… well, it was a major bummer. I believe my technical analysis was correct, but I misread the market sentiment. The market was obviously euro-averse given all the bad news that has been coming out of Europe.
In addition, the forecast that the non-farm payrolls showing a lower gain than the previous month could have made traders even more risk averse. This trade gave my account a small 1% dent. My loss just goes to show how important it is to look at the fundamental and sentimental environment as well.
One good news and one bad news. I guess it all balances out! Perhaps next week I’ll just purely get good news! Wish me luck.