DislikedDear Alfonso and fellow traders, I have a potential set up on the Aud/Eur that I would really appreciate your comments on as it is giving me mixed signals. I have marked the sell area on the H1 with sell arrows. However as you can see the departure from the supply area is strong[2],risk reward of 3 is possible[2] ,big picture is where I have an issue .In my curve Daily Chart the descending trendline has been broken as has the Weekly so I cannot sell. Moreover the price is in the Monthly and just above the Weekly Demand area. So we are high in the...Ignored
When you find a contradiction or missed signals on any pair you are looking to trade, you can do 2 things:
- Skip that pair for now (the wisest decision). You will have hundreds of opportunities with perfect signals, why bothering with mixed signals?
- Take a risk based based on the highest timeframe (WK and/or Monthly)
The bigger the timeframe, the higher its reliability. Go always with the big timefarmes. Don't be worried if you miss a trade.
In your EURAUD or AUDEUR (it's the same after all, but inverse), I would wait for the bigger timeframe's reaction. I mean, if in the lower timeframes you are having supply respected and demand removed, and you are very low at WK/MN demand, then the logical thing to do would be waiting for the bigger demand to "take control". Since your entries are based on H1 or H4 timeframes, the second thing you could do is go short until you are near a good zone on your entry timeframe (H4)... You must be aware that you are low in the WK/MN curve, so if you take a short, you should not be expecting a super big run, but that could happen as well.
Just be aware of the fact that if you are too low in the bigger timeframes (WK or Monthly), the probabilities for a swing short are much lower. It's all about probabilities. You can wait for some reaction to the buy side with brand new levels, or short until you penetrate even lower the higher timeframes, right until you reach a level on H4 with a great imbalance, you would exit before such a level (20-30 pips minimum, don't be greedy). That would be my rationale behind it.
But again, whenever you mind signals.... don't trade! You will have hundreds of opportunities with perfect signals, why bothering with mixed signals?
Alfonso