Thursday, 10 November 2011

WHY THIS FOREX TRADE loses? -22 Pips EUR/USD 08-09 Nov 2011 Tue Trade. Forex Trading Analysis Sharing.


08Nov 2011   

WHY THIS FOREX TRADE loses?

How I trade? Forex Trade Setup.
A) Analysis:
1) Forex Technical Analysis
a) Key Level (Hourly Chart) @1.3825 (Previous day high)
b) Bearish Engulfing Candlestick Chart Pattern
c) Pivot Point Indicator @ Resistance Level 1
2) Forex Fundamental Analysis:

a) GLOBAL MARKETS-Stocks, euro pare gains after Italian vote

Details:
Tue Nov 8, 2011 10:55pm SST
(Reuters Currency News)
·         European stocks pare gains after Italy vote
·         Berlusconi wins vote, but loses majority. Berlusconi wins budget vote after opposition  abstains; results indicate he has lost majority
·         Italian 10-year yields tick higher

b) Euro rallies on news Italy's Berlusconi will resign

Details:
NEW YORK | Tue Nov 8, 2011 2:01am SST
 (Reuters Currency News)
·         The euro jumped versus the dollar in afternoon trade on Tuesday after Italy's president said embattled Prime Minister Silvio Berlusconi will resign after the approval of new budget law.

B) Forex Trade Position Management
1) Trade
a) Sell Market @1.37842 @11:25:35 PM @ 8-Nov2011 Tue 
b) Stopped out @1.3806 @2:48:40 AM @9-Nov        2011 Wed -22Pips

C) WHY THIS FOREX TRADE loses?
            Reasons:
                        1) Unexpected news as per A2b- Euro rallies on news Italy's Berlusconi will resign.
                        2) Late entry + chasing the market

4 comments:

  1. Hello friend, regarding the above trade comment which you took.It was a nice trade that would have given you a good profit if you had digested the general bias of the market very well.Why do I say so, i believe that most rally northward that occurred during that period always fizzle out because fundamentally all euro economies are immersed in debt crisis-Lack of growth in most individual economies,high unemployment rate,high bond yield rate ie, cost of borrowing to finance its project....with exception of Germany.
    I look to always sell EURUSD at rally using daily time frame.....why fundamentally euro economies(excluding GERMANY)do not offer any growth potentials for now and also USD has always serve as safe haven currency when there is uncertainty and loss of confidence in the global financial market as result of recession or depression in any of the advance economies.
    Except EURO re-establishes growth,job and confidence in its market investors will always look for an opportunity to sell EURUSD at rally.
    Remember forex is trading strong currency against weak currency.

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