"Successful traders have a larger edge and better money management than unsuccessful traders. Unlike popular belief however, this study shows that the smaller edge of successful traders is not the cause of their failure. Traders' failures can be explained almost exclusively by their poor money management practices."
"The Secrets of Successful Trading", Fernando Diaz
The pair seems to still stucked in a range near the upper resistance which happens to be very close to the year high at 1.4450 region. so far we are yet to witness strong buying pressure to push above the high at 1.4447. Price now trades around that region. on the whole the uptrend channel which can be clearly seen in the daily chart still holds.
For those who are actively trading the forex market in recent times might have notice the changes in the price action of the market. Well, I don’t know whether u guys are aware or I am still new in this field and lacking in experience, but the most obvious change in behaviour is that price action recently is extremely volatile, if we were to compare candle patterns in 5 minute charts. Candles these days are much more bigger compared to previous two months, and that we usually would see “V” shaped turning points in the market, thus making moves hard to catch at times. In addition to that the lack of a solid trend in the market does not make trading any easier. Again the theory of impermanence holds very true in the markets where we see changes across the market on an ongoing basis, that’s way strategy that works yesterday might not be able to perform as well in the near future when the market changes its behaviour. But nevertheless the evergreen techniques of using the SR levels and candlesticks still prove to be profitable. It would only be a hindrance at these times if one would choose to see the situation recently as hazardous and unproductive, but if one would view this situation as an avenue to improve on trading skills then in these challenging times we would see opportunity to discover new trading methods and improve our understanding on the markets. Learning never ends especially when we are dealing with human behaviour and the markets is build based on a large collection of human behaviour amplified by human emotions. So let us take this opportunity to expand and grow with the markets, the desire to excel and keep pace with the markets will eventually led to elite performance !
we can see that for this week the market failed to rally back to the peak at 1.4446 and instead tried to go further down, but found support at the 1.4080 region, i would see that the current situation is from neutral to slight bearish with support seen at 1.4050 to 1.4000 region and resistance at the 1.4300 to 1.4350 area. Bearish momentum might continue if we see the pair failed at the 1.4350 area again next week and that the support at 1.4000 gives way. Further up move must see clear break above the 1.4446 resistance.
The weekly candle seems to indicate further correction before we can see another move up in EU. important levels to watch for this correction might be 1.4150, 1.4000, 1.3850 and 1.3750
After struggling for nearly 2 months, the pair finally broke out of the resistance at 1.4350. at this moment a retest at the 1.4700 high created last December 2008 might be in the cards now.
This blog is use primarily to share my analysis and also global economic view with fellow traders worldwide. a little bit about myself: i have a background in engineering and some in finance. I am a person with a passion for trading the financial markets and a thirst for knowledge to understand the global economy with respect to crowd psychology. i'm also charting enthusiasts emphasize mainly on candlestick price action. You can drop me an email at zhao168@gmail.com
