After the recent disappointing loss on a highly anticipated short trade on this pair, I am now re-analyzing this pair from scratch to see what I missed and to see what could happen now.
But while I am doing that, I just want to throw this out there for those that are mystified as what to do next on this pair. There's really no mystery....WAIT! You need to see more price action before you can tell with more confidence what to do. Don't feel like you NEED to be in a trade or you'll miss something! This is a very amateurish mistake.
Anyway, here's what I need to see before I do anything LONG OR SHORT. This is examples of the kind of price action I want to see. If LONG, then I need to see a much clearer move up and away from the freshly broken structure and then a move back down to retest it and if the structure holds, then I would look for a BUY.
IF for a SHORT, then I would need to see prices break below the structure AND break the lower TL of the trading channel it is in and THEN see it retest the structure from the bottom and if that structure holds, then I would look for a sell.
This is pure PA in action. It is the most reliable indicator BUT it takes a lot of patience to execute. And yes, it might not happen this way and yes, you could miss trades waiting on it, But having PA on your side is WAY better than not having it on your side!
Not sure if this is appropriate but would you mind recommending any trading books which you find particularly useful?
AUspicious
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I am really trying to pick up on PA, so I really appreciate you taking the time to explain your thoughts on Price Action.
EverythingForex
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You're welcome. PA is simple on the surface but hard in practice. It's hard mostly because of the mental aspect of needing to wait and be patient while prices are moving all around you making you feel like if you don't get in to a trade, you're going to miss out on it. Most people just can't be patient enough for PA to unfold before they jump into a trade. I am just showing 2 of the most basic but fundamental kinds of PA. There are many others. It takes experience to really get a good feel for it. I don't know of any good books out there that purely deal with price action.
AUspicious
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I am guilty of jumping in trades because I feel like I am missing out, so I know what you're talking about.
LPlady91
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thank you for the motivation to keep me patient. I just started live trading. so far 3 small bad trades for jumping the gun too quick. learned my lesson I will now wait for every single opportunity I see. no matter how long. even if I miss it, fine. ill just wait again. again, thank you
Robski
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Perhaps a silly question, but what do you need the RSI for?
EverythingForex
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It's there to help tell me where prices are now in relation to overall direction and momentum. I don't use it for anything more than that. In other words, it does not factor into whether I take or don't take a trade.
Robski
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OK. I see. I think the overall direction on this time frame is very clear from the context of price action and each move the eur made here. You can ascertain the momentum from the structure of the candles in relation to the previous structure - they are getting less impulsive, but still going up. Don't get me wrong, I'm not being critical - I'm sure you are a much better trader than I am. I was waiting for the price to stop at the level as well, but levels are nothing more than lines in the sand and if the price moves down from here I don't think you can say your analysis was wrong - different players entered the market and pushed the price higher establishing new level. My 2 pips worth...