Tom Hall Market Review #7 - Sunday, 24 March 2019
Tom Hall Market Review #7 - Sunday, 24 March 2019
Canadian Dollar / Japanese Yen
Weekly Timeframe -
The Weekly timeframe developed a high-test reversal candle on the 25, February 2019 rejecting the 84.40 horizontal structure resistance, 50EMA and 61.80% Fibonacci retracement.
There's certainly an argument to enter the market once a high-test reversal candle formed rejecting structure. However, it's paramount clean technicals develop on the Daily and 4-hour timeframe prior to entry.
Daily Timeframe -
The ascending wedge formation dating back to the 03, January 2019 squeezed price action on the approach to the Weekly structure previously outlined.
A high-test reversal candle formed rejecting the 84.20 horizontal structure resistance, in addition to breaching the ascending trendline structure support.
The acceleration that developed throughout the first week of March confirmed my higher timeframe thesis.
Once price breached the Daily 50EMA, I delved deeper into the intraday timeframes to identify a trade opportunity.
4-hour Timeframe -
The large sell-off from the 84.20 Weekly and Daily structure meant the 4-hour timeframe was overextended on the RSI, this indicates a consolidation period is highly probable.
Drawing a Fibonacci from the swing high at 85.23 to the swing low at 82.40 presented a 38.20% Fibonacci retracement at the 50EMA, 200EMA, and Weekly Pivot.
A short position was initiated on Tuesday, 12 March 2019 after the 1-hour timeframe approached overbought status confirming the deceleration.
Activated: 83.066
Stop Loss: 84.527
Take Profit: 80.759
Trade Closed Manually:
It's very rare I close positions early; however, on this occasion there was a basket of negative confluence factors that could not go unnoticed.
The sell-off from the high at 84.08 to 82.31 caused the 4-hour, 1-hour and 15-minute timeframe to be oversold.
In addition to the technicals, we were quickly approaching the CAD economic data, the consensus was not favorable to our active position and ultimately adding negative confluence.
The option to adjust our stop loss to breakeven and await a consolidation period was unavailable due to the 4-hour 50EMA exceeding our initial entry at 83.06.
Capital At Risk: 0.50%
Reward / Risk: 1.58:1
Maximum Drawdown: 0.40%
Total Profit: +0.26%
Canadian Dollar / Japanese Yen
Weekly Timeframe -
The Weekly timeframe developed a high-test reversal candle on the 25, February 2019 rejecting the 84.40 horizontal structure resistance, 50EMA and 61.80% Fibonacci retracement.
There's certainly an argument to enter the market once a high-test reversal candle formed rejecting structure. However, it's paramount clean technicals develop on the Daily and 4-hour timeframe prior to entry.
Daily Timeframe -
The ascending wedge formation dating back to the 03, January 2019 squeezed price action on the approach to the Weekly structure previously outlined.
A high-test reversal candle formed rejecting the 84.20 horizontal structure resistance, in addition to breaching the ascending trendline structure support.
The acceleration that developed throughout the first week of March confirmed my higher timeframe thesis.
Once price breached the Daily 50EMA, I delved deeper into the intraday timeframes to identify a trade opportunity.
4-hour Timeframe -
The large sell-off from the 84.20 Weekly and Daily structure meant the 4-hour timeframe was overextended on the RSI, this indicates a consolidation period is highly probable.
Drawing a Fibonacci from the swing high at 85.23 to the swing low at 82.40 presented a 38.20% Fibonacci retracement at the 50EMA, 200EMA, and Weekly Pivot.
A short position was initiated on Tuesday, 12 March 2019 after the 1-hour timeframe approached overbought status confirming the deceleration.
Activated: 83.066
Stop Loss: 84.527
Take Profit: 80.759
Trade Closed Manually:
It's very rare I close positions early; however, on this occasion there was a basket of negative confluence factors that could not go unnoticed.
The sell-off from the high at 84.08 to 82.31 caused the 4-hour, 1-hour and 15-minute timeframe to be oversold.
In addition to the technicals, we were quickly approaching the CAD economic data, the consensus was not favorable to our active position and ultimately adding negative confluence.
The option to adjust our stop loss to breakeven and await a consolidation period was unavailable due to the 4-hour 50EMA exceeding our initial entry at 83.06.
Capital At Risk: 0.50%
Reward / Risk: 1.58:1
Maximum Drawdown: 0.40%
Total Profit: +0.26%
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