Despite bad China data on Saturday, it actually comes as an opportune moment because it gives AUD/USD a chance to retrace a bit on this bull move. I've drawn an inverted head and shoulder pattern to indicate a possible long term directional change.
Wait for price to retrace to the 50% fib level (0.900X) or 61.8% fib level + trend line test (0.898X) for a possible long entry. Consider exiting if price manages to close below the trend line. Target: Low 0.91XX region (previous swing high)
Update: Considering price did not test the trend line yet, I'd say this trade still has a shot to fill there. However, price looks to have bounced off of the 50% fib level so far and I've already filled 30% of my long position at 0.9015. Anyone else get a position?
Comments
ForexWeeklyAnalysis
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Update: Price is moving down towards the trend line now but since some time has passed since I posted the original analysis, the place where the trend line will be tested is different. So beware of that, it may be coming in at 0.897X now or maybe even 0.895X.
ForexWeeklyAnalysis
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EDIT: I don't know why but trading view charts look different compared to my charts. On my chart, price is already at the trend line but on trading view, it's not.. which is why I made the comment of price may bounce lower.
ForexWeeklyAnalysis
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Price just hit the trend line and I just filled half my position at 0.8980, I've been trading with my charts for nearly 3 years now so I'll choose to trust mine over trading view's...
ForexWeeklyAnalysis
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Filled some more at 0.8960, my average price is now 0.8980
ForexWeeklyAnalysis
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Just woke up and surprised to see price dropped a bit since last night. When I can't watch PA (e.g., while I sleep), I set a SL of 100 pips. I can afford to do this since I use fairly low leverage.
Why 100 pips?
- It's considered a wide stop by most traders, so it'll prevent being stopped out from the small spikes.
- At the same time however, it's wide enough but also necessary to prevent catastrophic losses from a major move.
Had I been awake, I may have considered adding some more at 0.8930 but it looks like I may have missed that opportunity now.
(DO NOT ADD MORE IF YOU CANNOT AFFORD TO DO SO, I'M WELL BELOW MY ACCOUNT EXPOSURE LIMITS)
ForexWeeklyAnalysis
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Given my position in this pair (full position), GBP/USD (full position) and USD/JPY (30%). I'm only at 23% of my account exposure limit, so I have plenty of margin to play with.
ForexWeeklyAnalysis
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Added 50% more at 0.89325 (0.8930 + spread), now I have 150% (more than what I normally risk per position but I have extra margin as I mentioned above), my average price is now 0.8965.
ForexWeeklyAnalysis
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Some of you may not agree with this "adding to losses" but I'm not really adding to losses, I'm just allocating margin to increase my position size. Considering I usually only 10% per position, with my 3 live trades, I can go up to 333% for each position if I see fit.
ForceFollower
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That's fine, but you can add to your loser for a limited time only - until you reach your predefined 100% 1R risk level.
ForexWeeklyAnalysis
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True, my comment was mainly focusing on risk exposure rather than absolute risk.