The Discipline of Waiting for a Strong Trade Setup in Forex Trading

Are you disciplined enough to wait for a strong and prefect trade setup, or you take a position whenever you sit at the computer and analyze the charts??? Please watch this video carefully. It shows you how we wait for the markets to form a strong trade setup. Also, please subscribe to our YouTube Channel.

Before you read the rest of this article, please note that this is NOT a trading or investment advice and we are not trading and investment advisers. We are just sharing chart analysis techniques. You understand that you buy/sell/hold at your own risk. Also, please make sure to read our terms of use and privacy policy.

The last closed daily candlestick on EUR/USD daily chart has a strong bearish body. Many traders take a short position. But this is extremely risky for two reasons:

  1. EUR/USD is strongly bullish on the daily chart. It is too risky to take a short position at the top of a strong bull market.
  2. The last close daily candlestick (2020.08.07) has a meaningful lower shadow. Although it is not too long, still it means bulls are strong and can take the price higher at any time.

Please also read this article carefully: A Strong Forex Day Trading Strategy

And also watch these videos to learn what you should wait for on the charts exactly:

  1. The Basics of Japanese Candlesticks Patterns and Signals for Forex and Stock Traders
  2. Doji Candlestick: What Does the Doji Candlestick Pattern Mean?

Below is EUR/USD daily chart. As you can see, the last closed daily candlestick has a strong bearish body, but it has a lower shadow that although it is not too long, it says bulls are still strong and can still take the price much higher:

The last closed weekly candlestick has closed almost as a Doji, that reflects indecision. Please watch this video: Doji Candlestick: What Does the Doji Candlestick Pattern Mean?

But, EUR/USD monthly time frame is great now…

We are waiting for something very interesting on EUR/USD monthly time frame. If it happens, we will be long on EUR/USD for the next several months or even year.

Currently, EUR/USD is trying to break above the downtrend resistance line on the monthly chart. So far, it seems that the downtrend resistance line is valid. We are waiting for one of the monthly candlesticks to closed above the resistance line, so that we will have a strong long trade setup. Also, it is possible that EUR/USD cannot break above the resistance line, and so it forms a sell signal or short trade setup below it. Let’s see:

The last closed weekly candlestick on USD/CHF chart has closed as typical Doji that reflects indecision. Please watch this video to learn what this Doji means on USD/CHF weekly chart: Doji Candlestick: What Does the Doji Candlestick Pattern Mean?

The current daily candlestick has tried to retest the broken support level on USD/CHF daily chart, but it couldn’t even reach the level.

If you are new here, and you don’t what this broken support level is, and how it has formed a short trade setup for us, please read the below articles and watch the related videos in them:

  1. Why Is Bitcoin Going Up?
  2. A Strong Forex Day Trading Strategy
  3. Buy Stop Order Explained
  4. Taking Short Positions Explained
  5. Fibonacci Trading Strategy After Sideways Market Breakout
  6. Forex News Trading: Employment and Unemployment News

And below is the currently forming daily candlestick that tried to retest the 0.91867 broken support level, but it couldn’t even reach it, and I don’t think this candlestick will ever reach the broken support level, and will close today at 05:00pm EST eventually. Wait for our today’s market analysis video, and our article tomorrow.

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By The LuckScout Team

I don't believe in luck. I believe in sweat. The more you sweat, the luckier you get.

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