Day Trading and Swing Trading the Currency Market by Kathy Lien

Author:Kathy Lien
Language: eng
Format: epub, pdf
ISBN: 9781119220091
Publisher: Wiley
Published: 2015-12-29T00:00:00+00:00

Figure 13.1 USDJPY Daily Chart

Source: eSignal

Figure 13.2 USDJPY 60-Minute Chart

Source: eSignal

Now let's take a look at an example to the long side. Figure 13.3 shows a daily chart of EURUSD with the ADX below 20 and pointing downward. This is the first signal that a trade setup is in place. In this example, the previous day's high is 1.0801, and the low is 1.0708. We see that the low is broken first, and when that happens we place an order to buy 5 pips above the previous days high at 1.0806. As shown in Figure 13.4, the order is triggered about 7 hours later. At the time, we place our stop at 1.0786 and a first target of 1.0826. The first target is reached shortly after, and the stop on the rest of the position is moved to breakeven, or 1.0806. In this example, if we trail the stop on the position using a two-bar low, the second half of the trade is closed at 1.0818.

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