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I’ve been trading forex much less these past four weeks — heck, a girl does like to take a vacation! — and now that I am back, my focus is more on the short term: 15, 30, and 60 minute charts. I also want to mention that I’ve tried to establish a bunch of posts that explain how I trade and now I’d really like to transition to more updates about my actual set ups…

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With the current direction of the 60 minute chart heading lower and the Asian session trading, the bounce into the 34ema low (bottom of the Wave) has set up a short off the 50% Fibo level. This trade is valid as long as prices stay below the top line of the Wave plus five…so that’s currently 95.58 and also just above the 61.8 Fibo.

My downside targets are currently 95.20, 95.05, and 94.80. A word about multiple targets. First I think they are a necessity but I realize not everyone has graduated to trading with multiple lots…and that’s fine. Here’s what you do:

As the trade moves in your favor, when the first profit target is hit, move your risk-based stop loss to a break even which is the entry plus five pips. If the trade hits the second profit target, use the previous profit target as the trailing stop and so on.

If the trade is sitting between the first profit target and the risk-based stop loss, that’s “no man’s land” and you basically sit tight…

This content is strictly for informational purposes only and does not constitute as investment advice. Trading any financial market involves risk. Please read our Risk Disclosure to make sure you understand the risks involved.