USD/CHF 10-min trade example

Posted July 8th, 2010 by Rapid Forex 12 Comments »

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…

Tags: 10-min, 90 Day Forex Trading Bootcamp, closed trade, forex sailing, live trade, online forex trading, trade example, USD/CHF Posted in trades

12 Responses to “USD/CHF 10-min trade example”

Anthony Says:
July 8th, 2010 at 10:09 am
Brian, I lost big on this one also. I got in the first time at 1.05147 @0.20 lot & got stopped out at 1.05258 $-25.08.
Like you I believed it would finally go my way so I reentered at 1.05228 @0.50 and got stopped out @ 1.05540 $-153.95.
Maybe I am stupid but it still looked like a great trade so I reentered one last time at 1.05414 @0.50. My initial stop was 1.0561 above the last high. Not exactly as the system prescribes but according to what I was doing pre-camp. I have now moved my stop loss to +11.3 pips (1.05301). the trade is at the time of this email at +53.1 pips $250.87.
For this last trade my points are as follows.
15 min chart
I =1.06299 date 07 9:30 gmt
II =1.04814 date 08 8:00 gmt
III=1.05637 date 08 8:30 gmt

Looks like I will recover from the failed trade. I would appreciate any comments on my doing this. I felt the trade still worked per the rules but I did not place my initial stop loss way up at point 1. My money management would not permit that.

[Reply]
Maks Says:
July 8th, 2010 at 10:38 am
Yes, this is for me the hardest to learn to live vith lost trades also – this is just part of trading. Thank you Brian for sharing us real world exaples. This is real stuff, I like it!

[Reply]
John Lawrence Says:
July 8th, 2010 at 11:57 am
Brian Why I am not trading—-Over the course of 3 years, I have blown up several accounts and probably got through $20k in that period. I have systems, methods, robots etc coming out of my ears. I find it hard to pick up the pieces and try again. However, I do know that there is a comfortable living to be made if I can find the correct system—-please help me Kind regards

John Lawrence

[Reply]
Rapid Forex Reply:
July 9th, 2010 at 6:01 pm
@John – My goal is to help you. The best advice I can offer is to keep following this blog until you feel comfortable to trade again

[Reply]
Fred Riggins Jr. Says:
July 8th, 2010 at 1:03 pm
Good stuff Brian!
I am trading the sail pattern on demo. I have had several losing trades but I believe I will be ok with practice.
Thanks for showing us the good, the bad, and the ugly.

Fred

[Reply]
Jeanny Says:
July 8th, 2010 at 5:04 pm
Brian

I don’t really understand the eToro screens. For this USD/CHF trade, please explain how the following numbers were calculated:
$2.67 (Set a Stop Loss Limit and Open Trade Amount)
$3.24 (Set a Take Profit Limit)
0.29 spread
0.10 profit
3.57% gain

In the trades you have done so far, III is usually not the same as the entry price. And when calculating reward/risk, sometimes you use the value of III while other times you use the entry price value. How do we know when to use which one of the two for calculating the reward/risk ratio?

[Reply]
Rob Says:
July 9th, 2010 at 12:19 pm
Aloha Brian,

I’m afraid I missed both trades, my computer decided it did not want to co-operate just before the first trade was announced. Once I got it up and running again the second trade was announced and completed while I was in bed. I’m in the UK. No worries though, I am still learning from the bootcamp and there’s still plenty of time to go. Keep up the good work.

Rob

[Reply]
Rapid Forex Reply:
July 9th, 2010 at 3:19 pm
@Rob – sorry to hear that. I’m focusing more now on the trades that I’m watching as well. This way even If I miss it (I have to sleep too – other bootcamp members can grab it.

[Reply]
Amador Says:
July 12th, 2010 at 10:42 pm
Hi Brian,

I am following your trade and can’t trade live; here’s why.
June 11 I sent 500.00 USD to etoro for deposit by way of the Western Union. Days, weeks and my inquiries always returned “investigating” in response. I had to keep my cool otherwise, I might not see that money again. The latest of it though was that it would be with their accountant. I had been with ODL and CMS years back with no hitch
whatsoever.

Best regards,

Amador

[Reply]
Rapid Forex Reply:
July 15th, 2010 at 12:47 pm
Sorry to hear that Amador, perhaps it’s just an accounting glitch that will soon be straightened out? Let me know as time passes by if you still don’t have money in your account…

[Reply]
Pat Thomas Says:
November 2nd, 2010 at 3:11 am
Brian,

What brokerage do you use where you get a 400:1 margin?

Pat

[Reply]
Rapid Forex Reply:
November 5th, 2010 at 9:35 am
eToro has 400:1 margin in a UK account, which you can still get if you’re in America.

[Reply]