2016-05-02_18-44-55cadchfdaily

Dear all,

If you miss your entry or the better entry then you either jump in the trade or you skip the trade.

I chose this cadchf chart where you may see a beautifull double top.

The stochastic was completely overbought and price was already moving sideways showing exhaustion before the drop.

I passed on the trade because I personally prefer to trade in direction of the trend.

Trend can be defined by choosing the same direction of higher highs and higher lows or trading in direction of a moving average whatever works best for you.

But you should have no doubts when you are trading. this means if you shorted then yes you shorted from reistance and yes in direction of the stochastic but bear in mind that this is a counter trend trade.

This may mean that price will only provide you with a retracement and the continue its mission north.

On the other hand if you are lucky then price might reverse the trend and you are already well positioned.

Perhaps it would help if you take notes on your trades and see what statistically works best for you.

You may call it journalling your trades and see what kind of trading setups work best and what trading style suits your personality best.

Please do not hesitate if you have any doubts or want a certain topic to be covered.

Wishing you the BEST OF PIPS…

2 thoughts on “Missing a trade”

  1. Ryan Gandalf van Jaarsveld says:

    Thank you Nuno – I really like these educational pieces you are writing lately! So to go back to your initial point – you mention that if you miss the trade then you either jump in or skip the trade. How do you go about getting back into the trade – I imagine you wait for a retracement and the stochastic to show overbought or oversold depending on whether you are long or short? Do you have any more pointers you could share on this?

    1. Nuno Lampreia – Forex.Today says:

      Hi Ryan,
      Its very good to hear back from you.
      You may switch to a smaller time frame and wait for a retracement of an oversold / overbught stochastic and then trade in direction of a higher time frame.
      The goal is to put your stop of the lower time frame at breakeven and hope to ride the trend of the bigger time frame.
      You may choose a role reversal area where previous support becomes resistance and go short if bear right from the zone / area. But I would always recommend to trail your stop at least until break even.
      I hope this helps
      Cheers…

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