USD/CHF 10-min trade example

This is an actual trade that was posted to the private blog for the LIVE 90 day forex trading bootcamp, click here to join the LIVE bootcamp.

The Trade as It Happened

It’s 2:20 am GMT on July 8th, 2010. I just placed a trade on the USD/CHF.
I just placed a trade on the USD/CHF. Here are the details:
currency pair: USD/CHF
timeframe: 10-min
Most Recent 10-min wave:
I – 1.0523
II – 1.0479
III – 1.0508
Entry: 1.0495 short
Stop: 1.0523
Limit: 1.0464
Max Profit: 31 pips
Max Risk: 28 pips
Reward/Risk: 110.7% size: 1,000 units @400:1 leverage – 1.335% of account risked.
*When entering this trade, I actually misread the spreadsheet. I should have waited for the price to go up a little further before entering. Since the reward/risk is still > 100%, I’ll stay in the trade. Looking at all timeframes, there’s a downtrend – which you can see on my filled in market snapshot: Here’s the chart that I saw: Here’s the fibonacci sheet I filled in: And the orders placed: And then adjust stop & limits:

What I’m Waiting For

This trade still represents a good short opportunity, I just got a less than great entry price. I’m watching the 1-min & 5-min charts to see if the price will go up near 1.0508 (III) and then turn back down. Since I only have 1.335% of my account at risk, doubling this trade to 2.7% is still ok. This will average out to a better entry price for 2,000 units. If the price doesn’t bounce off the 1.0508 price, I’ll simply get stopped out

20 Minutes into the trade

The price has shot up to the 1.0508 level. Now it’s testing the resistance of the channel that formed earlier in the day. Here is where I’m looking on 1-min charts to see if the recent 1-min uptrend that’s moved to the 1.0508 level will be broken by a bounce. I’ll know this when a 1-min and/or 5-min umbrella handle forms. Or it’ll keep going up & blow the trade… Here’s what I’m hoping for with fingers crossed:

Stopped Out for a $2.66 loss

At 3:28 am GMT I got stopped out for a $2.66 loss of 28 pips. This loss would have been less if I hadn’t entered at a lowe reward/risk of 111%, but sometimes you make mistakes… This was one of those times. What’s a shame is that it looks like this trade may still happen the way I intended and this loss could have only been a pip or two away from profit.

Final Thoughts

This trade is a perfect example of when a trade simply goes against you. You can’t be right all of the time, this was one of those times. We had a nice consolidation breakout moving down in the direction of the higher timeframe trends. Unfortunately, this was a time when the trend ended. This is why money management for forex trading is crucial, so you can live to trade another day
As a 90 day forex trading bootcamp member, you’ll don’t just see the perfect trades, you also see the ones that don’t work out. This is real forex trading, not just theory…

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