22 February 2013

EUR/USD : Missed A Trick

  • Had been running long EUR (weekly ISHS) vs short GBP (triangle breakout) recently. Following the GBP periscope, I unwound the long EUR (from 1.3286 downwards) leg of the EUR/GBP trade to get more naked short cable.
  • Should have been paying more attention to the EUR/USD daily chart. By sheer coincidence, there is a SHS top with NL at 1.3303 which I missed. So got out of my long EUR/GBP because of the cable chart when in fact I should really gone further and gotten naked short EUR/USD as well on the break of 1.3303.
  • No matter. Initiated a new short EUR/USD @ 1.3234. Better late than never. Plan is to add another unit if we approach 1.3303. Cut loss above.
  • Of lesser import, there is an uptrend line at 1.3220 being tested now. (TL breaks make lousy trade signals, except when you are not paying attention).
  • SHS downside objective is 1.2878.
  • Need to re-think the weekly ISHS. Might be time to consign it to the failed dumpster.

5 comments:

Taichiseal said...

-1.3272

Anonymous said...

Hi Taichiseal, I have been following your block for sometimes (almost a year), I am getting a bit confuse of your statement that "TL Break make lousy trade signal"? I thought you are a trend follower and trade a lot of TL break and/or pullback of the TL break? Eg the Short Copper trade on Feb-20 and short EUR trade on Feb-22? To me, the 2 trades are based on TL break?

Rgds,
Robert

Taichiseal said...

Pick any chart where the market is trending, say upwards. During retracement periods, there will be many occasions where any UpTL you draw is broken = false sell signal. I much prefer to act only on classical reversal patterns (ie new trend), not TL breaks alone.

1. The 20Feb Copper trade is indeed a TL break. But I only took the trade more because I have been trying for the longest time before that to get in early on the weekly triangle formation = downtrend continuation. If it was just the daily TL break, I wouldn't have made the trade.

The 22Feb EUR/USD short is based on the daily SHS top. Nothing to do with the TL.

Anonymous said...

Understand better now, thx.

Rgds,
Robert

Taichiseal said...

No worries. Thanks for visiting.