I've already included the reasons as to why I think it will be coming down but I will still write them here as well: Reasons to Short: 1) Double Top 2) RSI Overbought 3) RSI Bearish Divergence 4) Tweezer Tops
The reason why I think is coming down is that in the bigger picture we're looking at a flat correction where legs A, B (98%) have been formed so we'll be looking to catch leg C. Although a rare occurrence, Running Flats, where leg C is cut short from it's full completion, they still do form so protect what you have and make sure you trail your stop all throughout the downside.
Now I say on the chart that the 1.2100 level will be broken first before turning for the reason that if you scale down to the 4H chart the pair is forming a Flat correction from the latest impulse, therefore it will most likely make a last push to break that level and then turn. This also happens to be a classic bank manipulation technique, in order to induce buying pressure and trap retail investors into buying when in reality they will be driving the price back down.
My personal details : Short @ E: 1.2100, SL: 1.2200, TP: 1.1600, RR: 5
For risk and money management purposes, always determine a max. of 2% risk on every trade. For example on a $50,000 account, this would be equivalent to 1,25 Lots with an 80 pip stop loss. Targets and closure of positions may be subject to alteration throughout the course of the trade. This is due to the ever-changing and unpredictable nature of the market. This post is set to be used and serve as an example and in an educational manner and is not to be taken as direct investment advice.
Kommentar
⋅
Those who missed the initial move down, wait for a correction before entering.. Don't sell at the bottom now...
This chart is pure class! n' almost half way through the 500 pip journey
Aqua_Trader
⋅
@Muzoeph, @Muzoeph, Appreciate your comment :) . Yes we are n in the coming daysow forming a small correction and we should hopefully get a stronger impulse down
Kortak
⋅
I did not see that chart construction until now and was really looking for an explanation about the recent downtrend of the EUR/USD despite the fact that we received a lot of good news from the eurozone. I really thought that we would break the 1.2100 level easily and went long...hopefully I was on a demo account, because good news after news I lost all my trades after each rebound. The only fundamental news that I was thinking of, was that the ECB wouldn't allow the EUR to go higher than 1.2100 to support the economy in a starting boom. At the end, it seems that it is more due to technical analysis reason with may be the ECB behind it, who knows ...
Aqua_Trader
⋅
@Kortak, In my opinion all sorts of news out there, and social media in general are all manipulated one way or another. They will never tell you what you need to know, they will only tell you what they want you to know which is why I purely trade on technicals. Patterns will take their course one way or another, fundamentals or no fundamentals which is why I choose not to trade those. I only look at major events such as NFP reports, or Retail sales figures, events that will shake up the market a lot so that I do not trade when they will be happening. But i do not trade based on those.