We can now dial in with more precision where this zone is. There is an elevated probability we’ll see a reaction lower taking place in the 1.3050-1.3150 price range. This doesn’t mean prices WILL trade lower. What it means is the trend is up and those positioned to the long side need to manage their risk. If you’re not long, an ensuing dip near 1.27-1.28 will offer an opportunity to position long.
Retail traders have been net short at FXCM on the USDCAD since June 18. Since that time, price has rocketed higher about 800 pips. Sentiment continues to be heavily shifted towards shorts as the ratio is -2.7 and open interest in short positions has grown 9.5% since last week. So it is the technical wave relationships that are flashing the caution sign now. If prices move above 1.3150, the door is open towards 1.34.
However, be mindful that the retail traders might actually get this one right and prices may sell off a bit. Look for the red support line to break and for SSI to shift more positive to be additional indications of a larger sell off coming.
Once your trade closes out, I would suggest trading in the smallest trade sizes possible for a few days so your mind can reset to taking on losses.
A chemical is released in our brain when we experience pleasure...winning on a huge trade will certainly release that chemical. I can tell you already have it with the excitement of your post. I am thrilled for you and glad you've had a super run on this trade. You managed this trade to a 'T'!
Reality will check in once it closes out so small trade sizes and literally unplugging for a couple days will help you reset.
It sounds weird, right? After a winning streak to take a break. Perhaps use that break to enjoy your profits from this trade.
I can only wish to make this much on every trade! Better to be safe than sorry...
Hopefully it fails here and we get a pullback for re enter. Wave 4 comes in around 1.27 to 1.28 which is also the .382% fib at 1.27304 from the latest move so that makes sense and looks good.