I’ve started the Year with a tough bout of man-flu which again has kept me from spending anything other than brief moments at the trading screen. As much as I strive to post trade entries live I just couldn’t manage it on the blog for the current and only open trade although if you read my ADVFN forum I did manage a brief post there at the trade inception.
The trade in question is a EUR:AUD swing short from resistance opened during the evening of 7th January from 1.5269. The initial target was the 1.5000 area marked by the previous swing high on the Daily chart which could become support for the current correction but since entering the moving averages have risen possibly suggesting price wont go as low as I initially hoped.
Here’s the Daily chart showing long term resistance at the recent major swing high:
The Hourly chart shows a failed re-test of resistance followed by rejection from the green 200 MA which became the main factor for entering the trade:
….But the 4 hourly chart has price meandering around the green 200 MA which could well offer support ahead of a double top scenario and this needs keeping an eye on to avoid the current 65 point profit disappearing fast:
All in all I think what we’re seeing right now is just a correction within an ongoing up-trend and I do believe we’ll see quite a deep correction although I’m not convinced the current pull back is the start of it – we may well see marginal new highs first although I’ll stop the trade out well before then if that starts to look likely. Ultimately the major trend is up and once a deep correction is over we’ll probably see price rally even higher but I just don’t know whether this process will take Weeks or Months and therefore its the Hourly and 4 Hourly time frames I’m most interested in for the current trade.
This trade hasn’t yet been entered into the 2014 trades log because I’ve not had chance to create it yet but will do so as I hopefully get rid of this flu over the coming days!