EURUSD: anatomy of short term trades
Updated
Good morning Everyone,
this structure shows the uptrend that ended when NFP were released on Friday 3rd of Sept.and also the correction that unfolded afterwards. The Kumo generated by Ichimoku supports the uptrend and keep pressure on the correction and has a similar function to the 100 moving average (blue).
Based on this structure a first trade could have been entered on Tuesday 7th of Sept.at 13:00 when support at 1.18600 (blue horizontal line) was breached to let it run until RSI entered oversold prior to the ECB meeting. In fact the correction paused on Wednesady and consolidated prior to the event supported at 1.18100 (red horizontal line).
After the event the pair run into the Kumo to escape bearish pressure. It made a brief top above the Senkou Span B but it was sucked into the Kumo again and lost momentum. The Senkou Span A at 1.18200 was breached Friday in the afternoon and the pair closed the week on the supporting level of the consolidation period at 1.18100.
The pair commenced this week with same bearish sentiment it had closed the preious week and a new bearish move begun to gain momentum after 2:00 o'clock when the 1.18100 supporting level was breached. An entry could have been set up when the 6 o'clock candlestick attacked 1.18022 (orange short term horizontal supporting level that was built between 3 and 5 o'clock) to let it run until RSI entered oversold.
In my view the 1st trade was "easier" because mid-week and more clean than 2nd trade. 2nd trade more risky because it was Friday and price closed above 1.18100 supporting level.
To note that at the moment there is a divergence between lows made by price and sentiment.
Please like if you want me to share more screenshots of the move in lower timeframes and updates on the pressure provided by the bearish structure or the divergence with indicator.
If you have any question please ask.
Thank you and kind regards
Cozzamara
Disclaimer:
Please note that I am not a professional trader and these are my personal ideas only. The information contained in this presentation is solely for educational purposes and does not constitute investment advice. The risk of trading in securities markets can be substantial. You should carefully consider if engaging in such activity is suitable to your own financial situation. Cozzamara is not responsible for any liabilities arising from the result of your market involvement or individual trade activities.
Trading in foreign exchange (“Forex”) on margins entails high risk and is not suitable for all investors. Past performance is not an indication of future results. In this case, as well, the high degree of leverage can act both against you and for you. Before you decide to invest in foreign exchange, you should carefully assess your investment objectives, experience, financial possibilities and willingness to take risks. There is a possibility that you will lose your initial investment partially or completely. Therefore, you should not invest any funds that you cannot afford to completely lose in a worst-case scenario. You should also be aware of all the risks associated with foreign exchange trading and contact an independent financial advisor in case of doubt.
this structure shows the uptrend that ended when NFP were released on Friday 3rd of Sept.and also the correction that unfolded afterwards. The Kumo generated by Ichimoku supports the uptrend and keep pressure on the correction and has a similar function to the 100 moving average (blue).
Based on this structure a first trade could have been entered on Tuesday 7th of Sept.at 13:00 when support at 1.18600 (blue horizontal line) was breached to let it run until RSI entered oversold prior to the ECB meeting. In fact the correction paused on Wednesady and consolidated prior to the event supported at 1.18100 (red horizontal line).
After the event the pair run into the Kumo to escape bearish pressure. It made a brief top above the Senkou Span B but it was sucked into the Kumo again and lost momentum. The Senkou Span A at 1.18200 was breached Friday in the afternoon and the pair closed the week on the supporting level of the consolidation period at 1.18100.
The pair commenced this week with same bearish sentiment it had closed the preious week and a new bearish move begun to gain momentum after 2:00 o'clock when the 1.18100 supporting level was breached. An entry could have been set up when the 6 o'clock candlestick attacked 1.18022 (orange short term horizontal supporting level that was built between 3 and 5 o'clock) to let it run until RSI entered oversold.
In my view the 1st trade was "easier" because mid-week and more clean than 2nd trade. 2nd trade more risky because it was Friday and price closed above 1.18100 supporting level.
To note that at the moment there is a divergence between lows made by price and sentiment.
Please like if you want me to share more screenshots of the move in lower timeframes and updates on the pressure provided by the bearish structure or the divergence with indicator.
If you have any question please ask.
Thank you and kind regards
Cozzamara
Disclaimer:
Please note that I am not a professional trader and these are my personal ideas only. The information contained in this presentation is solely for educational purposes and does not constitute investment advice. The risk of trading in securities markets can be substantial. You should carefully consider if engaging in such activity is suitable to your own financial situation. Cozzamara is not responsible for any liabilities arising from the result of your market involvement or individual trade activities.
Trading in foreign exchange (“Forex”) on margins entails high risk and is not suitable for all investors. Past performance is not an indication of future results. In this case, as well, the high degree of leverage can act both against you and for you. Before you decide to invest in foreign exchange, you should carefully assess your investment objectives, experience, financial possibilities and willingness to take risks. There is a possibility that you will lose your initial investment partially or completely. Therefore, you should not invest any funds that you cannot afford to completely lose in a worst-case scenario. You should also be aware of all the risks associated with foreign exchange trading and contact an independent financial advisor in case of doubt.
Note
The following screenshot shows the divergence between price and sentiment lows (red arrows). The divergence happens on the 50% retracement of previous uptrend (AB). To note that a similar divergence occurred also on the 32.8% Fibonacci level. Note
UPDATE: the pair is pulling back from 50% of previous uptrend towards bearish pressure of the correction. 
Disclaimer
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