H&S Trade Diary: 1-2
No luck on the third trade for the Head and Shoulders strategy: GBPUSD – 1.82% / 45 Pips
This pattern was a little more abstract than our previous trades, note the descending Neckline and Head which was actually a smaller H&S pattern:
I watched the smaller H&S pattern (Head) forming on the hourly, but felt the ascending neckline was too steep to warrant an entry and was put off by the over blown shoulders. Pair then carved quite a small right shoulder, developing a descending neckline, which looked like a great low risk/easy target opportunity. I drilled down to my 30m chart to look for a break as per the strategy rules:
The break came pretty quickly, but this trade gave very little joy at all – moving just 27 pips in our favour before reversing and taking out the 45 pip stop loss.
Points Of Interest:
This is a great example of subjectivity coming into play – even when trading a ‘concrete’ strategy: if I had shorted the smaller pattern with a 75 pip stop above the overblown shoulder, the trade would have hit it’s 112 pip target for around 3% profit.
OG H&S: 1
Three trades down and ‘Market’ is one up – leaving our demo account down -.87%
Note: ‘Slight’ delay in updating the diary this time around – will be staggering updates over the next week or so – or feel free to check the Myfxbook account for spoilers!
Risk Disclosure: In addition to the website disclaimer below, the material on this page prepared by Australian Forex broker Vantage FX Pty Ltd does not contain a record of our prices or solicitation to trade. All opinions, news, research, prices or other information is provided as general news and marketing communication – not as investment advice. Consequently any person acting on a Forex live account it does so entirely at their own risk. The experts writers express their personal opinions and will not assume any responsibility whatsoever for the actions of the reader. We always aim for maximum accuracy and timeliness, and Vantage FX on the MT4 platform, shall not be liable for any loss or damage, consequential or otherwise, which may arise from the use or reliance on this service and its content, inaccurate information or typos. No representation is being made that any results discussed within the report will be achieved, and past performance is not indicative of future performance.