My long from 1.4572 stopped at breakeven.
The pair then proceeded to a low of 1.4251 where it bounced to 1.4455. It has now began faltering from this price with an evening star formation in process on the three-hour chart. In order for this three-candle formation to complete, the current (third) candle must close deeply into the first one. If it does, one could expect more lows. Note that unlike the Euro it has not plunged below the early 2009 lows.
I am now short from 1.4387 with a tight stop. Support is at 1.4298, 1.4110, 1.3654, and 1.3503. Resistance is at 1.4455/76 (today’s high and the 5/7 Friday doji low), 1.4633, 1.4703, 1.4851, and 1.4918.
Here’s the three-hour chart:
© Dianne Fecteau, 2010. No part of this material may be reproduced in any form, or referred to in any other publication, without the express written permission of the author.
My purpose in writing this blog is to show you how one trader, me, makes trading decisions and survives while trading Forex. One of the biggest problems I had when I first started trading was trying to apply the “rules” to actual trades. Another was the psychology—limiting losses and letting profits run. If you study my blog, you’ll see how I deal with both those issues. So my writings are not trade recommendations but rather educational in purpose. You have to decide on your own approach to trading. Remember that trading is risky.