The trend was UP the entire day. It looked like there was a trend change candle before our session but RSI was still greater than 50 at the time of the crossover. In this case you have to wait for the next candle to see if RSI would continue to move below 50 to confirm the new downtrend. RSI bounced back up and cancelled out what would have been a new trend change candle. Therefore the trend remained up.
Today I only looked for long trades.
News events to watch for today :
- 5:30am EST– UK Claimant Count Rate; Claimant Count Change; ILO Unemployment Rate; Average Earnings; BOE Minutes
- 8:30am EST– UK Chancellor Osborne Presesnts 2013 Budget to Parliament
2:15am EST- There was a moving average crossover for a long trade. RSI was greater than 50, stochastics were trending up, and MACD went from negative to positive. This was a valid signal. I entered at the close of the candle at 1.5090 with a stop at the most recent swing low at 1.5078. Since I was 10 pips away from the nearest 50 or 00 level I decided to put my initial target at 1.5100.
Entry: Long at 1.5090; Stop: 1.5078; Target: 1.5100
5:30am EST- Didn’t even consider this signal since it was a news candle.
8:45am EST- There was a moving average crossover for a long trade. RSI was greater than 50, stochastics were trending up, and MACD went from negative to positive. This was a valid signal. I entered at the close of the candle at 1.5143 with a stop at the most recent swing low at 1.5040. Since I was only 7 pips away from the nearest 50 or 00 level (1.5150), my first option would be to go for the same amount of pips I was risking. In this case that would make my target a whopping 103 pips away. With this system, we are only looking to capture moderate gains so when this happens you simply want to go for the next 50 or 00 level. This means my target on this trade would be at 1.5200.
Entry: Long at 1.5143; Stop: 1.5040; Target: 1.5200
11:45am EST- My target wasn’t hit. Since 12 noon was approaching I decided to manually exit my trade. I got out at 1.5140. (-3 pips)
Trade Result: +10 -3= +7 pips R-Multiple: 0.83; -0.02
News events to watch for Thursday:
- 5:30am EST– UK Retail Sales; Public Borrowing
- 8:30am EST– US Initial Claims
- 9:00am EST– US FHFA House Price Index
- 10:00am EST– US Existing Home Sales; Philly Fed Index