Forex Price Action – Why did one Price Action Pin work and not the other.
Forex Trading System What happens when 1 pin fails to break?
Forex Trading System What happens when 1 pin fails to break?
Forex Trading: Usd Chf pair
In the chart above shows 2 highlighted pin bars.
If a trader took the first price action pin bar (marked as 1) and placed his stop loss right at the bottom of the pin -
He would get stopped out and would have possibly missed the winning move upwards.
How can we improve this?
- This is the reason why i always recommend traders to place their stoploss 10 pips below the edge of the pin. By doing so you would still be in the trade and not get stopped out by the next bar.
- If you did get stopped out by the next bar. You would have gotten back your pips in this trade as the next bar formed another pin bar (marked as 2). This forms a double pin bar. A setup that shows that price is indeed going up.
Therefore you would still get back into the trade on this pin bar and took it right up.
Alot of traders when got stopped out by at the first pin would not have taken the 2nd pin due to the fact that they had made a loss in this pair, and they “feel” that this pair is no longer reliable. And they “feel” that since the first pin has been stopped out, the trend is no longer heading the direction they wanted.
This is a common syndrome by most traders – Dwelling on the PAST Trades
Remember – every trade you take is a new trade. And is a fresh beginning.
Forget what happened on the last trade, regardless of whether that is a winning or losing trade.
Focus on seeing what is right in the new trade. And not let PAST perceptions affect your judgement.
Therefore in this trade, had you not dwelled on the first pin that had been stopped out.
You would have seen that it formed a double pin bar! And this double pin bar is in the right upward trend movement.
You would have taken this trade without hesitation.
Ezekiel Chew
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Forex Price Action – Why did one Price Action Pin work and not the other.
Forex trading pair: EUR CAD , AUD CAD
Many traders asked me, why do you look at so many forex pairs.
This post will be a good reply towards the question.
In the forex chart above, AUD CAD and EUR CAD.
Both pairs have the same denominator pair – CAD.
Therefore, both pairs should be co-related in one way or the other.
In this scenario, both pairs formed a pin bar as highlighted (blue box) on the 150 moving average (orange line).
But what we can see on the end result is that – the Eur Cad price action pin turned out to be a good one with profits taken and the aud cad had no result.
Forex Price Action – Why did one Price Action Pin work and not the other
When trades of co-related pair happens, i would only choose the best one of out the 2 in this example.
And we would have chosen the EUR CAD.
Why?
Lets look a little deeper for further analysis.
1) When the aud cad formed the pin bar – there is impending HIGH impact news on the AUD pair. As shown in the top left hand corner of our Asia Forex Mentor news indicator.
2) When we compare both the price action pin bars. The Eur Cad was a better one.
With the opening and closing at the top of the pin bar. And the closed was above the 150 moving average.
The aud cad forex pin bar however looked more like a neutral bar than a pin bar – with its opening and closing in the middle.
3) The Eur Cad had tested the 150 moving average recently before and it held well.
With this 3 factors alone, we would have taken the EUR CAD instead of the AUD CAD. And would have taken profits already as marked in the chart.
So my answer to the question on why do i look at so many forex charts?
- Had we not have the eur cad on our chart and only the aud cad. We would have taken the aud cad and missed out on the Eur Cad.
- The more charts we look at, the more charts we can compare – To choose only the BEST ones.
Thats the reason for our high winning probabilities.
- Our system works on all pairs, which is why we have so many opportunities in the market.
This is just one of the ways on how trade,
Ezekiel Chew
Asia's #1 Forex Mentor