Price has bounced off Intermediate Support as indicated by the Rejection Candle. A rejection candle printed at a support line is a good indication a trade reversal upward is beginning. This is a good spot to enter a long trade.
I have placed my Entry 2 pips above the high of the candle preceding the rejection candle. I want to make sure price makes a new higher high before entering a Long trade. A higher high would help to confirm price action is ready to move higher.
I have placed my Stop Loss 2 pips below the low of the rejection candle. If this pair is ready to move higher then price action should print a higher low and the Stop Loss should not get hit.
I have plased my Price Target at the Intermediate Resistance level for a nice 3:1 reward to risk ratio. Price action normally moves from support to resistance so I expect price action to hit my price target.
The distance between my Entry and my Take Profit is 150 pips. Price moves on average about 130 pips per week for this pair. Therefore I would expect this trade to last a little more than 1 week to complete.
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I have placed my Entry 2 pips above the high of the candle preceding the rejection candle. I want to make sure price makes a new higher high before entering a Long trade. A higher high would help to confirm price action is ready to move higher.
I have placed my Stop Loss 2 pips below the low of the rejection candle. If this pair is ready to move higher then price action should print a higher low and the Stop Loss should not get hit.
I have plased my Price Target at the Intermediate Resistance level for a nice 3:1 reward to risk ratio. Price action normally moves from support to resistance so I expect price action to hit my price target.
The distance between my Entry and my Take Profit is 150 pips. Price moves on average about 130 pips per week for this pair. Therefore I would expect this trade to last a little more than 1 week to complete.
HAVE A CURRENCY PAIR YOU WANT ANALYZED, SENT ME A PRIVATE MESSAGE!
Comment:
This trade setup continues to be valid!
Should price action continue to move downward then the candles should continue to make lower lows and lower highs and the Entry price should not be hit.