Tuesday, December 2, 2014

2 Dec 2014: AUDUSD daytrade

This was a purely discretionary trade where I tried to use market psychology. 

The RBA had just announced that it was holding interest rates. During the first five minutes, news traders caused the AUDUSD to rally, but it began to retreat. I saw this as an opportunity to trap bullish news traders and went short towards the close of the 5M candle. I aimed for a reward of 3R, just above 0.84500. 

Price began stalling at around 1.5R, where I moved my stop loss to breakeven. When I saw the tiny bullish pinbar form, I decided to take profit. A 50% retracement would've taken out my B/E stop loss, so I didn't have a choice. 

Shortly after, price began marching upwards again. Did the trappers end up getting trapped? 

(click to enlarge)

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