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Scalp trade description May, 17, 2010

Discussion in 'Sive Morten- Currencies and Gold Video Analysis' started by Sive Morten, May 18, 2010.

  1. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Hello, everybody
    As I’ve promised, today I’ll show you example of a scalp trade and the process of decision making, that I’ve passed through every time when do this. I think that this example is interesting, because during last time in my researches I’ve made notes that “I do not want any “hold” position”, because EUR/USD is oversold from the one side and I do not see any Buy signal from the other. In such circumstances scalp trade is an only way.
    This example is my trade on EUR/USD that I’ve made May 17, 2010 and you can find it on my FPA demo account. So, let’s start with it…
    This is a 4-hour EUR/USD chart. The context for possible small retracement was as follows:
    - Market has reached objective point at daily chart and daily oversold;
    - Market extremely oversold at monthly chart and just above monthly Fib. support.
    - Market has reached OP=1.2252 at 4-hour chart.
    And market starts to retrace a bit. This scalp trade is in fact a momentum trade – we see thrust down, all trends (monthly, weekly, daily) are bearish. So, I’ve expected that market should make a retracement lower after correction up. For now I have to estimate the probable level, at which I should to enter short.
    First, on 4- hour chart at 1.2422-1.2433 Confluence resistance area, up move should not be too strong and far, so I expect that 1.2400-1.2422 not bad level to enter short.

    Now let’s look on 5- min chart. Here is all my trade.
    When I’ve look at it in the beginning of up move, I’ve calculated Fib Expansions, and 1.618 expansion (that is XOP) was precisely at 1.24 that was very close to 1.2422 strong resistance. So, 1.24-1.2422 is a area when I had to watch for potential reverse down. And that had happened. Market has reached XOP=1.24, and has shown a solid thrust down, 5-min trend has turned bearish. I’ve entered on 0.382 retracement after this thrust down and placed stop a bit higher 0.786 level. My target was 0.618 retracement of a whole up move at 1.2305. When market has reached it for the first time, it didn’t touch my profit just for 0.3 pips. So, I’ve waited a retracement up, then exit at 1.2322. Although market has reached my target a bit later, I think that I did no mistake, because market is very unstable now.

    Sive
     

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  2. lochuer

    lochuer Recruit

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    The take

    Just trying to look back at this trade and get an understanding of the retrace % and your entry point. Am I correct that this was about a 20pip scalp?
     
  3. Sive Morten

    Sive Morten Special Consultant to the FPA

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    Enter around 1.2380 exit 1.2322. - about 60 pips
     
  4. SRTango

    SRTango Recruit

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    The best explanation I have read so far. Waiting for your new post.
     

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