Had you followed my advice last week you would have caught 300 pips from the cad alone using this method. In last weeks post entitled “forex Trade Examples” I gave you detailed analysis as to how to trade break outs on the forex 4 hour charts.
In the “Forex Trade Tip” analysis of last week I told you to look out for such a move on the cad. The result if you took my advice was 300 pips on the cad and 130+ on the euro cad.
This is what I had to say about the Cad – “There is a doji candle on the daily chart which signifies indecision. Price has now entered a tight range, which is normal after a big move such as last weeks. If breaks out upwards, could go to 1.1400 area or down to 1.0800″. Price broke out and down and hit a low of 1.0792 !
There was also an LMT signal on the wednesday morning that would have got you in for a 200 pip move.
In the current markets lots of pairs are at trend lines as well as horizontal support and resistance lines.
I would strongly advise you not to take trades that are very near to these areas, as they will quite possibly bounce off. The more conservative way to trade is wait for confirmed breaks of the 4 hour charts.
A confirmed break is when a candle breaks & closes through a line.
The euro cad also gave us an identical trade, this time for a 130 pip gain. This was also signalled by the LMT (low maintenance forex trading) software that we use.
The red arrow shows where I entered the trade at a confirmed break of the support line.
The vertical red line is where the lmt gave a sell signal.
Had you simply entered the lmt trade you would have made 130 pips.
In thin markets that is an amazing achievement from a simple piece of software.
The Forex week ahead
You need to look very carefully at support and resistance areas this week. Lots of pairs are struggling at recent highs and lows. Take a look for example at the following euro/$ chart
Price has failed to break recent highs all week
As you can see, price has failed to break (and close) through the horizontal resistance line all week. Be very careful going long here, even if you get an LMT signal.
Even if it does break up here, the recent May high was only 1.4300 area.
Price is now being squeezed between the horizontal resistance line and the diagonal support line, to form a triangle pattern. The nearer price gets to the the point of the triangle, the more explosive the break out is in either direction. If price broke down here the 1st target would be 1.4000 area again. If it breaks that then 1.3850 will be next.
Due to family commitments (getting ready for our holidays) I haven’t time to analyse all the pairs for you today. Look closely at the euro example. There are similar set ups on many of the pairs. If you are trading the LMT stick to the advanced rules and if you are combining the 2 methods look for breaks of support and resistance. good luck with your trading.
If you would like to trade forex successfully with us here on the blog, we have more than 1500 registered traders, and 16.500+ on twitter following both my advice, and sharing advice with each other.
The following is concerning the LMT forex formula. More than 500 of us here trade this system. It is the BEST, SIMPLEST,CHEAPEST forex trading system I have found in almost 6 years of trading forex. Click on the coloured banner below to find out more, regards, marc walton
These are the results (as supplied by Alex) for june 23rd 2009 to 21st july. For summer time thin markets these results are simply astounding.
| Daily | H4 | ||||||||
| Broker | total | won | lost | win/total | total | won | lost | win/total | |
| GMT1 | 8 | 3 | 5 | 38% | 91 | 73 | 18 | 80% | |
| GMT2 | 7 | 4 | 3 | 57% | 95 | 74 | 21 | 78% | |
| GMT3 | 7 | 4 | 3 | 57% | 85 | 69 | 16 | 81% | |
| total/avg | 22 | 11 | 11 | 51% | 271 | 216 | 55 | 80% | |
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