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Seeking a Trade Patiently

You never know what will happen in the markets and when it comes to making trading decisions you need to be prepared to be very patient and only trade solid setups. Today’s trading conditions were very slow and didn’t show too much in the sense of potential trade setups. We waited for over two hours to take our trade of the day and it still wasn’t the most competent trade available. Soon after our trade we realized that certain setups were available earlier in the morning. Sometimes you miss opportunities because market conditions are so slow and we just didn’t feel the need to take a trade.

In this trade we noticed our price was channeling and created a triple bottom. Price moved through the third bottom and we saw the pivot was right below. Being the price had been fighting this area over the last couple hours we didn’t have much confidence in the pivot line holding as a price point for a turnaround. When we notice price moved through the pivot and then consolidated just below, that is when we decided to take our call option. This call option was slated for the price to move back above pivot and to continue to the area where the channel had just been formed.

All last week we were taking reversal trades on the trend near extended levels of resistance three and support three. In this case, with price not really showing a direction we had to be a little bit more cautious when it came to picking market direction. At this time we did consider price moving back up and that is why we took a call option versus a put option to the South side. In the end, price continued to move up from where we entered and never went below are entry price this morning. Although our intentions were not to find a bottom on this trade it is kind of nice to realize that your trade was the bottom for the day.

The image below shows a few things that occurred this morning before we even entered our trade. As you can see the channel forms tops and bottoms. You can see how price eventually moved through on the third attempt down past the pivot. This is the price we use for entry. Last week we used extended moves past certain areas of support and resistance. This is the same type of trade as price moved through the pivot line and consolidated. This gave us a nice set up and although it wasn’t a huge winner it did have a strong move to the North side soon after.
EURUSD Triple Bottom
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