Summarized Technical Analysis and Market Sentiment:
EURUSD has weakened extensively since U.S. election and that Trump polocy may push for a faster rate hike this year. The ECB has also mentioned that further QE is needed to achieve its inflation target, causing the euro to be traded weaker.
On the techincal chart, the price has rebounded from a major support level and eventually broken above a previous swing high, completing its 1st wave of probable reversal.
The price then completed a retracement channel and that’s when I decided to go for a long on EURUSD, right after a pullback from the bottom of the retracement channel at FR78.6% and a bullish candle to confirma a reversal.
Long with 1/2 risk as execution was at 1:19 am, an hour that I am about to sleep where I either stop trading and trade with 1/2 risk at the most while setting an alarm to make amendment at anytime through the night.
Stop loss was set 20 pips below the FR88.6% of the previous wave of appreciation.
The price then retraced further and was successfully supported at FR88.6% and rebonuded off, thus my decision to leave the trade unchanged and follow my trading plan.
The price then reached the swing high of the full retracement and started got exhausted, evenutally forming a potential minor head and shoulder. The trade was closed to avoid a potential retracement and also to wait for the retracement to take place to look for another buying opportunity, this time using the profit earned from this trade.
Result: Gain 0.94%
It wasn’t a fantastic trade but rather a trade to fulfill my urge for trading while maintaing good risk management and still following my trading strategy. The decision to close the trade prior to reaching my key take profit level was still considerably good because there is clear sign of retracement and the fact the the price failed to break above the retracement swing high.