Magpie Trader
Wednesday, August 31, 2005
Yesterday's trade 1
This is in response to Okl's request for live chart trade, unfortunately when I'm trading, all I can do is actually trade or I'll make mistakes, if there's time though I'll endeavour. So the next best thing is my thinking and some charts of yesterday as it was a particularily nice day!
The explanation is more for my own use, but the charts should show the trade ok. Explaining it too will no doubt also help me improve.
Daily - (At the start of yesterday's Euro session there was only a little of the last large red candle). According to my '5 star' trade set up, for a buy the 17EMA has to be above the 34EMA and rising. So here we have a buy, (although the EMAs are starting to flatten), especially as price at that time was sitting near a round number and also around the 17EMA. However the blue line following price down from the 15th August is actually the centre line of the 68 Bolinger band. (I like to use multiples of 17 for MA like indicators). As it's a stronger signal than the 17 and 34EMA - it suggests down - should have realised that on Monday...
CCI has also broken the Zero line and has started to move south - got to be careful with this indicator on the daily though as it can look one way but the lower time frames will change it with a big move.
MACD has flattened and may be turning over and spearating.
The RSI 6 line has crossed the the 14 and is separating and heading south.
So, the EMAs are saying a possible buy, but the other indicators are pointing to a more than probable sell.
4HR - I haven't quite caught the picture correctly but price is sitting around the 2 TLs around the 1.7920 area. The Aqua blue EMA is the 170EMA and could very well provide support, it's also around the point of previous price support at 7890. The 17 and 34EMAs are crossed and heading south. We've had CCI TL break and an RSI TL break, but the previous large move down has covered that, in fact CCI had hit the 200 and had hooked back up, so had RSI. A buy signal. However MACD has turned over and is separating at the water line - a possible sell.
Bit confusing here as what the 4HR is telling me. The probability is weighed to a south move.
1 HR - the arrows point to the 7-8am bar, we're at obvious support, however it's an obvious down trend with the 17EMA approaching.
// posted by Magpie @ 1:27 pm 
