UPDATE #2: Stop loss hit. All positions are now closed on this trade.
UPDATE #1: Trade is active now. See the chart in the comment section below for exact entry price.
Hello Traders,
It's been quite some time since I've posted any new idea, especially in Forex. That's mostly due to the situation in Greece and the uncertainty that it has caused in the markets. I didn't really trade that much this past week. I would really like to see the Greece situation to settle down a bit, before starting to risk to much of my capital into the markets. But this does NOT mean that I didn't place any trades at all, I had few positions open but I decreased the position size by half on each trade; therefore risking a lot less than I normally would.
Anyways, coming back to the main point, here we have a valid BEARISH Cypher pattern that has formed on Natural Gas. The key thing to notice for NGAS is that the market has made a new Low on the DAILY time frame, suggesting a possibility of another move to the downside. The risk to reward is also favorable for this setup. See the chart above for more details.
Note: I have attached the Daily chart below, so that you guys can see how the trend line (black) was drawn.
I will keep everyone updated on this setup, so that you guys knows when the trade setup has been invalidated or whether any targets have been hit.
Please feel free to AGREE or DISAGREE with this idea by leaving a comment below. Hit that thumbs up button (top left corner of this chart) if you like the idea. Good Luck :)
Hi money making,in my very humble opinion this trade is still very valid for a short.I will short it if the price goes little up.
moneymaking
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Hey Tahir, I definitely agree with you, after forming that huge red candle. The market also failed to close above previous LH, thus creating a very high probability of a downward move. I have seen this many times, market stops you out and then rolls over in your favor. I believe I placed my stop loss like all other rookie traders just above previous LH. Have to start improving on placing stops just far enough to prevent being stop out, but not far enough so that I don't risk more than I will make. The main thing to keep in mind about cypher patterns, which I FORGOT in this setup; OMG, is that they rarely have a good risk to reward ratio. You will usually have to risk more on these patterns, in order for them to work out. Definitely not forgetting this point for future cypher patterns :)
ccc1225
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I still believe you are right.
moneymaking
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Hey ccc, thank you :)
moneymaking
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UPDATE #1: Trade is active now. See the chart below:
TahirAli
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This trade doesn't look to be going well in your favour but still best of luck from me.The price can push back from previous high which is point X in your chart.
moneymaking
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Hey Tahir, yes it is not going that well. All we can do now is wait and see what happens. Everything was planned before this trade was taken, now all we have to do is just follow the plan. Losing on this trade doesn't mean a lot to me, since this is just a single trade setup. There will be plenty of opportunities ahead.