Hello dear friends!
I hope your last week of trades was a green one! Otherwise for sure you´ve learned a lot from your mistakes. Psychologically speaking, we grow in a society that is intolerant to mistakes but mistakes make us grow and become mature. Mistakes are part of our nature and the human being. Never avoid taking responsibility of your mistakes but learn from it! “A good trader, learn to loose first before becoming a professional winner.” An excellent quote from a African trader and forex strategist called Azeez Mustapha.
Last week our trade plan review here http://thegeekknows.com/2013/08/elmar-eurusd-trading-plan-august-20.html produced a good entry point on eurusd around 1.3300- 10 with target back to a retest of 1.3400-15 for around 100 pips profit. If you got this trade, congratulation! If not, well forex will be always there next trade!
For this week I´d like to be a little more conservative! As you already read on Masoud Article here http://thegeekknows.com/2013/08/masoud-eurusd-forecast-august-26.html, he identified a break out on a triangular pattern that suggests continuation from this bullish trend since July.
Our trade plan will focus on bullish opportunities as follows:
Give special attention to the yellow dotted line on the attached chart. This is the top side of Masoud triangular pattern who suffered a break out suggesting bullish continuation. Minding this, give a look to my technical indicator called EMA Envelope with 14 periods. Adjust its deviation until you can clearly see a bullish channel. Adding into this recipe, a round number 1.3300 that for this conservative trade, shall work as our key support same as last week trade plan. Right above 1.3300 we´ll set our trade with good candlestick confirmation. Once set the trade, our target will be a shot back to 1.34 as told The Forex Koala on his article here http://thegeekknows.com/2013/08/eurusd-forecast-august-25.html for this week to be a good resistance and of course our trade plan top price.
To the top side above 1.3400 we may see 1.3460 that for me is a nontrade signal. Risk/Reward too small to be worth the risk.
So that is it folks, patience as always, and manage accordingly your risk to never trade 1-3% of your total money in a single trade. A 3% Drown down is easy to manage another trade but 10% or 20% in a single trade, is a recipe to fear and subsequently a disaster. Stop loss plays the major part as a tool to survive for a living in the markets.
To finish this article a quote from Mark Douglas: “We can find any number of ways to avoid acknowledging a mistake so we don´t have to confront the pain, and in the process we cut ourselves off from what we need to know to grow, expand, and improve our lives.”
Nice week friends!