Good morning traders.
As I mentioned yesterday after a week away from the charts I like to feel my way back into the action by getting a handle on the rhythm. It´s not that I was expecting anything much to have changed, more that I need to mentally attune myself to the eurusd price action in relation to the bigger picture of sentiment across the board – equities, gold, other major pairs, euro crosses and the dollar index (which reminds me I need to go through how I use this index – USDx – to help me trade our pair).
Anyway I´m now back in the groove so lets go!
I thought I´d try and give you something a little different this morning rather than simply talking about the daily and the hourly charts.
As you know I take all my trades based on price action on the lower time frame charts namely the 5 and 15m charts. I use the Daily for bias and the hourly for ´major´inflection points but check for patterns and price action lower down. So today I´ll try to give you a look at what I´m watching for on the 15m chart.
First up – a quick word about the daily.
The Daily Chart
We could be looking at a double bottom formation here at 1.13 level (as I mentioned yesterday). It’s not certain that this is the case but as traders we simply need to be aware that this is one scenario and trade accordingly. The bounce from 1.13 was quite firm overnight so I´m happy to test this scenario should we get a dip to a decent inflection point lower down.
This is where I´ll be looking at the 5m and the 15m charts ( see below ). I could easily be wrong but that’s not the point – if you don’t test your ideas at good reaction levels you´ll never make it in this game.
You have to be prepared to lose and comfortable with that if you are ever going to make money!
The Hourly chart
From the hourly we can see that price action was positive in responding to the 1.13 level with price making higher lows on the hourly. We can also see that a decent reaction point to test the double bottom scenario comes in at around 1.1327 (marked up in green).
The 15m Chart
Granulating price action further onto the 15m we can see this level more clearly and we can see how the price was giving us lower highs throughout yesterday afternoon and evening down to the 1.13 level followed by a series of higher lows overnight. I have also noted the Monday low at 1.1360 as the next level higher up which if we get a dip to our 1.1327 level would give us a good first target. (looking at price as I write we might be there by the time you get this!) – but that’s fine – it’s all about what you need to look for to improve your trading.
If we have broken through this level watch for a retest to get on board – see my marked up chart.
Btw – Monday ranges are very important.
The pink line is the price at 12 midnight in New York – another important level for day traders – more later. As a learning exercise look how price traded up to the pink line yesterday afternoon and reacted strongly to bounce lower before starting its climb back up.
It’s not really possible to write up all the things I look at in taking my trades and in the main the hourly levels are good enough in themselves to be profitable.
If anyone wants to learn more just give me a shout by dropping me an email to firstname.lastname@example.org.
We have Non Farm Payrolls tomorrow but tbh it’s not what it used to be as we already know jobs in the US are booming so I don’t really let it influence my trading that much these days. It’s enough to sit it out, watch the rip and dip to stop out the unwary and then get back in at our levels.
As I read the above I know that I have only touched the tip of the iceberg in explaining the detail. My apologies but as I say contact me for more detail.
Have a good one !!