My Millionaire Goal

EURUSD 24 Mar

The chart above seems to show a perfect setup…

1. MACD Divergence
2. Price Action: Bull trend bar after a strong bearish bar, plus a reversal from a break of a channel trendline (not drawn)
3. Fibo 61.8

However, I did not take the trade… I just have a strong gut feeling that this is a trap… I may be wrong.. but it’s better to err on the side of caution…

I think I feel uneasy about this trade because of the strong bearish trend before the reversal setup… 9 out of 10 of the previous bars were bearish (the odd one out being a small bull bar).. I need to see more confirmation before I’m willing to commit to a bullish trade….

EURJPY 12 Mar

Here’s my interpretation of price action for the chart above:

1. Bar A seems to suggest a bear reversal, which was supported by MACD divergence and resistance at the Fibo 50 level.
2. The next bar, Bar B broke below the low of Bar A. In fact, it broke below the low of the previous 5 bars, further lending support to the idea of a bearish reversal. It also suggests that the breakout at Bar A is a failed breakout.
3. Yet, by the close of Bar B, a totally different picture emerge. The bulls fought back and managed to close the bar near the high. This suggest that a failed failure (a failure of a failed breakout) might be happening. A failed failure is a very reliable signal and in this case, we expect many bears to be trapped.
4. The next bar had the same high as bar B.
5. Eventually, Bar C broke above the matching high of its previous 2 bars. 2 matching highs is actually equivalent to a double top on a lower time frame. Breaking above this double top makes Bar C the perfect signal to enter long.

USDJPY 12 Mar

1. MACD Divergence
2. Bar A broke above Fibo 61.8 and a previous high
3. However, next bar is a small bear reversal bar.