Another opportunity to buy this emerging market pair, this morning the first attempt closed at break even (link below) as a larger pullback has developed. I have changed the count from an A-b-c pullback to W-X-Y a double three as elliot called it. I like this pullback more as it allows the price to retest the trendline that has guided this move higher, there are always risks but this time it is quite clear that either a falling dollar or a general risk on feel will cause the trade to fail.
My basic strategy is to keep buying these pullbacks until the trend is over as with this mornings trade even when i am wrong I normally get out without loss as some sort of bounce almost always happens from the projected area. I have set a buy limit order at the top of the green box with a stop just below.
My basic strategy is to keep buying these pullbacks until the trend is over as with this mornings trade even when i am wrong I normally get out without loss as some sort of bounce almost always happens from the projected area. I have set a buy limit order at the top of the green box with a stop just below.
Comment:
Price has moved higher before meeting my buy limit order. If the price moves above my blue X on the chart, i will cancel the order and have to wait for the next opportunity to buy which will not come until after the price has made a new high and begun a pullback
Comment:
the move higher did not cancel the limit order and price is now approaching the level again, the USD still has a good sequence against other currencies so I am still happy to take the trade if it makes the level. Stochastics and RSI have reset nicely, we never know what is going to happen but this set up has a high probability of success, i will be risking 2% of capital and hoping for a return of 3:1
Trade active:
it has taken three days for the trade to be activated, a sharp down move has hit the buy limit order, let's hope price is able to turn inside the projected area. The other correlated trade AUDUSD has its stop at breakeven so maximum risk is at 2%.
Trade active:
USDMXN appears to have turned inside the targeted area, a break of RSI trendline suggests that the cycle lower has ended and a new cycle has begun. Can this new cycle take us to target? only time will tell, as always it could be just a bounce before more downside, as a result, we must protect our equity and go risk-free at the first opportunity, I will move the stop to the previous low when price reaches 20.517, this is 50% of the leg lower and will result in risk reducing to less than 1% of equity. I will look to move the stop to break even if price gets above 20.6
