It’s another losing week for the HLHB as a lack of one-directional trading inspired tons of fakeouts for the major dollar pairs.
Before we get to the details, read all about my HLHB Trend Catcher System if this is your first time hearing about it!
Basically, I’m catching trends whenever the 5 EMA crosses above or below the 10 EMA.
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 dropped sharply on Monday before it traded slowly but almost steadily higher through the week.
Unfortunately for the HLHB, the euro only had momentum when it saw somewhat strong declines on Wednesday and Thursday. This resulted in the trend-catcher validating not one but TWO signals that were against the overall trend.
For now, the HLHB is going into the week with a short EUR/USD trade that can lose a max of 131 pips. Fingers crossed!
Unlike in EUR/USD, Cable was all over the place in the last couple of days.
The see-saw price action led to A LOT of fakeouts and the HLHB only screened out a couple of them. Boo!
By the end of the week, the HLHB had lost a net of 72 pips from closing an open trade from the previous week and three new ones from this week.
As you can see, USD/JPY rose sharply in the first half of the week before slowly but steadily declining until it was only a few pips higher than its weekly open price.
The pair only had one valid signal and, since USD/JPY hasn’t seen strong moves since then, the trade remains open with a maximum potential loss of 110 pips.
Here’s a summary of the open and closed trades from this week’s trading: