The Trade: EUR/CAD Long
Reason/Setup:
I entered this trade based on the OzFX system on 1 hour chart. I entered solely based on the indicator and not the price action. The pair had been in a slow downtrend when I got a long signal using this setup. The AC and AO indicators were now showing green, and the Stoch was trending up. Since the spread on this pair is large, I kept a stop of 30 pips and a target of 25 pips.
Trade Details:
- Date Entered: April 15 2008, 12:03pm
- Entry: 1.6103
- Lots: 10
- Stop Loss: 1.6073
- Target: 1.6128
- Date Closed: April 1 2008, 12:30pm
- Result: Pair hit stop loss.
- Total Pips: -300
- Profit/Loss: $294.35
- Rating: 3
Looking back, this was a stupid trade to enter. I entered solely based on the indicators and not the price action. As seen from the chart, despite the Stoch, AO and AC all showing a move up, the price has been steadily declining. When entering a trade, I want to make sure the price action is confirming the trend. I want to see couple of candles in the direction I plan on entering. This is especially true in a 1 hour chart as mistakes can be very costly.
The low rating is due to the poor selection of trade to enter.
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