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It’s back to the red for the HLHB!

Thanks to a big fakeout, this trend-catcher was set back by tons of pips even as it produced more winning trades during the week. Yipes!

Before we get to the details, read all about my HLHB Trend Catcher System if this is your first time hearing about it!

Trend Catcher SystemBasically, I’m catching trends whenever the 5 EMA crosses above or below the 10 EMA.

A trade is only valid if RSI crosses above or below the 50.00 mark when the signal pops up. And in this version, I’m adding ADX>25 to weed out the fakeouts.

As for stops, I’ll continue to use a 150-pip trailing stop and a profit target of 400 pips. This might change in the future, but I’ll stick to this one for now.

Oh, and as mentioned before, I’m switching back to applying the HLHB system to the 1-hour time frame. Using 4-hour in Q1 2017 and Q2 2017 wasn’t bad, but I think using this trend-catcher on the 1-hour could yield better results.

EUR/USD

EUR/USD 1-Hour Forex Chart
EUR/USD 1-Hour Forex Chart

EUR/USD rose sharply and steadily in the first half of the week, but it wasn’t until the second half when the HLHB validated some crossovers.

The system caught 15 pips after a new one popped up to prematurely close the first trade. I’m feeling optimistic about the second one, though, especially since it popped up on a retracement of the overall trade.

The second signal can now only lose a max of 120 pips after EUR/USD has climbed to its intraweek highs near the end of the week. Fingers crossed!

GBP/USD

GBP/USD 1-Hour Forex Chart
GBP/USD 1-Hour Forex Chart

Fakeout alert! As you can see, the HLHB validated a short signal right before Cable zoomed up to its intraweek highs.

The fakeout probably wouldn’t have such a big impact if I hadn’t had to close it when a second signal popped up. For now, the second signal can only lose by a max of 148 pips in the week ahead.

USD/JPY

USD/JPY 1-Hour Forex Chart
USD/JPY 1-Hour Forex Chart

No new signals from USD/JPY this week!

However, the currency pair has dropped enough to trigger an adjusted stop loss of an open trade that had started WEEKS ago. I can’t believe the weeks-long trade was only worth 2 pips!

I hope we’ll see more one-directional moves in the days ahead, and that the HLHB will catch most of those moves.

Here’s a summary of last week’s trades:

Huck's Signature