Another view of eurnzd. A possible channel forming and Fibonacci. 1.56 the next target? Interesting but I'll see what actually happens. These things have a habit of not working out.
I like the look of this audjpy. Nzdjpy looking similar. Most jpy pairs starting to turn down but aud is the weakest currency today. There is half an hour until my new candle so I will wait and see then.
This audnzd looks interesting too. The 100 sma isn't sloping much but it's a first bounce type trade. I'm going to leave it as I am short aud already but it's worth pointing out.
I was trying to get short on aud pairs a week or so ago and they didn't follow through but it's interesting to note that all the aud pairs are starting to look a little weak again and all look quite good on the weekly. Maybe it's time?
Eurnzd making progress down again. In the back of my mind I wondered if I should have been at break even that early. It's only one trade. There will be others.
Hi Ed Good to see you back and I am back in forex also. Took a long break of two years for life events (marriage & child). Looking forward to your new site. Regarding this system... How do you decide to move trade to break even?
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Hi Taw,
Moving the stop loss is about protecting your capital and then about locking in profit and protecting your gain. Usually if a trade has moved a certain distance away from your entry then you want to move it to break even because generally if the price comes back to your entry point it means there's something wrong with the trend, it's not going to follow through.
It's the same with moving your stop to protect profit. If a round number (100 level) is broken in the direction of the trend then that gives you somewhere sensible to put your stop loss behind because generally if it breaks the round number against the trend you probably want to get out with some profit while you can.
When to move to break even is not a hard and fast rule. In the case of that eurnzd trade the other day I was 40 pips up and it was showing signs of running nicely. In fact that was a mistake in hindsight due to the volatility of eurnzd, you could blink and eurnzd has moved 40 pips. I still do make mistakes sometimes. The setup with the channel forming and the stop behind the round number should have made me give it a longer rope. Never mind, there's always other trades.
If I could think of a way of codifying a rule to use for when to move to break even it would be once a 100 level has been broken with the trend then move to break even or lock in some profit. I hope this helps explain my thought process a little.
Audjpy not blazing a trail but it looks like the 94 level is holding price in. I like the look of usdjpy, although I am already short a jpy pair I like the bounce from the 100 sma so I will take a trade at my next candle open/close if it still looks good then, a couple of hours to go yet.
Chfjpy looks nice too but not in such a good place.
Hi Ed, Thanks for the explanation on the breakeven. Why do you say the CHFJPY is not a good place? Pullback not smooth enough and 60 pips away from 113?
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The pullback is ok but the trade is happening a long way away from the 100 sma already and in a bit of space. It's not near a round number or anything. On it's own it may be a reasonable trade but given the choice between one and the other I'd feel better selling usdjpy right near the 100 sma. It gives me another level of resistance to put my stop behind.
Swing Trading with Heiken Ashi and Stochastics - updated
