Welcome to my blog! This is where I share my trading journal; my thoughts on the financial markets and my analysis of the trades that I make. Today, I’m talking through a short trade that I made in the pair Kiwi-Cad. Read on to see how this trade went.
NZD/CAD Short
Expected Entry – 0.8182 Stop Level – 0.82 Target – 0.8145 R:R – 2.1
I haven’t placed this order yet, but there are some things I wanted to mention before/if I do. For one, the spread is high — close to 5 pips — so that’s kind of hurting my risk level. There’s already an additional 10 pips of risk I have to add to my original risk to account for the spread (which, of course, brings down my R:R).
If I set my entry 5 pips outside of the swing low from yesterday, it’s a “better” entry point, but my numbers aren’t there. If I set my entry 5 pips outside of the lows of the current rally/base, then my numbers are there, but I run the risk of price stalling at yesterday’s lows.
Overall, this has been incredibly weak, though, and RSI isn’t showing price as oversold at all, so I think that’s a risk I’m willing to take. I’ll set the order now, and I of course, reserve the right to cancel it if I don’t like how it moves over the next few minutes/couple hours.
Entry – 0.8182
It didn’t take long — only about 5 minutes after setting my entry order — for price to push down enough to trigger my entry into the trade.
Exit – 0.82001
Just as I called out might happen, price stalled out at yesterday’s lows, and rallied from there. In fact, yesterday’s lows were the lows for the foreseeable future, as price is up decisively from where my entry was.
Price as very weak overall, had rallied up to the 20 MA and was on it’s way back down. There was a strong push, the MA’s were sloping down and RSI was below 50 and not oversold. There wasn’t significant support at my entry, any prior key areas were from back in November, and price had pushed a bit through those levels anyway.
Overall, the things I look for, for a good trade, largely lined up. I honestly have no idea what I could have done differently here. Seemingly, it’s another play where I just happened to be wrong; but it’s starting to seem more like it’s my decision making process itself. I don’t know what else to do, though. I might have to do a George Costanza trading plan and do the opposite of everything my gut tells me to do. I’ve thought about trying something like that in the past, and I think it’s time to try to implement it.
All I can do now, though, is move on; can’t go back.
Thanks for reading! Let me know in the comments what you thought about today’s trade, and if you would have done anything different. Let’s get better together! And don’t forget to check back for more trades and analysis.