Timing to determine that a trend has reversed! Let's look at it by referring to the decline of USDCAD that we have been waiting for since last year
Hello, this is Baron Hardi (Hige Danshaku).
Yesterday I traded a USDCAD short!
I’ve been waiting for a fall in this currency pair since last year, and it finally seems like the trend has turned.
As for the trade, I would have liked to hold it a little longer, but it was Friday and the market has been unstable since the new year, so I closed it once.
If conditions look fine after the weekend, I will re-enter the market.
The USDCAD I traded this time has been in a gentle uptrend, and at year-end the market seemed to be turning toward a drop, which is what I was thinking would happen.
However, entering at that point would be NG!
The expectation of a drop is not analysis but a self-serving wishful thinking.
So, if you’re going to enter on a fall, it’s better to wait for the fall to actually begin rather than entering in a contrarian style.
This is the chart image I entered yesterday.
To determine a trend reversal, first wait for a decline that makes you think the preceding uptrend may have ended.
Judging solely by this drop is too early, so enter again when the market settles and then begins to drop again.
Because the entry is after the fall has clearly started, you could have captured an even larger profit if you had entered sooner, but I discard that possibility.
Entering with that aim is NG.
What matters is not buying at the top or bottom, but entering gradually in line with the trend.
Please use this as a reference.
On Twitter, I posted a series of steps regarding this entry, so if you’re interested, feel free to take a look.
