Is the current EUR/USD uptrend for real

[George FXtrades]

Hello Edward,

Thank you for the advice and recommendations for my previous enquiries.

I have an enquiry that needs your opinion and suggestion.

The EUR/USD pair was a lull on range trading with dips for almost 2 months recently, and now this pair begins moving northwards towards the 1.5000 and possibly reaching 1.6000 level in due course.

The 1-hour chart indicates the candlestick peaked the 1.4944 level on 15th October at 02.00 hour (Server Time), then retraced downwards and later an uptrend to another peak at 1.4954 the same day on 15th October at 22.00 hour (Server Time). These 2 peaks (1.4944 and 1.4954) form very strong Resistance Level that may establish a threat against future candlesticks’ advancement towards the 1.5000 and 1.6000 levels.

Shortly, from the 2nd peak (1.4954), a new non-stop downward retracement dropped until the trough level 1.4877 on 19th October at 09.00 hour (Server Time). This downtrend is evident by the 2 crossovers of the EMAs 10, 25 and 50 confirmed the bearish momentum headed for a trough on 16th October at 03.00 hour and 08.00 hour consecutively (Server Time).

However, the good news is the candlestick at the trough made an uptrend reversal at 1.48790, and with confirmation of the crossovers of EMAs 10, 25 and 50 indicating a strong bullish trend that started at 1.48970 on 19th October at 04.00 hour (Server Time). The ADX give a positive 38 %.

Now currently trading the Demo Micro Account and earned some profits during the current uptrend situation. Owing to uncertainties in Forex trading, with fear and anxiety trading LIVE, together with reservations of past month’s EUR/USD inconsistent motion, my questions are:

1. Would you recommend switching over to LIVE TRADING Micro account immediately to ride the prevailing strong bullish environment or wait for trading opportunity after the 1.5000 Resistance Level ?
2. Looking at the prevailing market trend of the EUR/USD pair, and the strong Resistance level at 1.4950 Level, my fear is the current uptrend may be short-lived with a reversal repeating a similar scenario (sideway consolidation) before the upsurge momentum that may affect my equity should the unforeseen downtrend persists dropping 90/100 pips suddenly.

Your viewpoints will be very much appreciated, while the final decision lies in my conclusion

Regards.

George FXtrades.

[Joe Whitehorse]

I'm sure Edward will address your query in due course, but if you don't mind, I'll add a few comments to the pot to maybe spike & encourage a little further consideration?

Owing to uncertainties in Forex trading, with fear and anxiety trading LIVE, together with reservations of past month’s EUR/USD inconsistent motion, my questions are:

I might respectfully suggest that if you’re experiencing fear & anxiety when attempting to trade a live account, you might want to spend a little more time exploring your strategies, observing how they interact with the different market conditions.

When the opportunity to trade presents itself, according to your rules of engagement, there shouldn’t really be any anxiety or apprehension to take action. Those are usually the by products of an unfamiliar or unconfident strategy/method.

If you pull up a 60 minute chart profile of the EUR/USD since the beginning of September, you’ll witness classic bullish trending action. Match the technical action with the overall Fundamental output, & it translates to a continuance of positive Euro positioning via the large institutional funds. They’ve simply been buying dips on any brief Dollar spike rallies.

The manner to which you approach your analysis & plan your excursions to the market, will dictate how you trade the market activity & manage your potential trade expectations.

my fear is the current uptrend may be short-lived with a reversal repeating a similar scenario (sideway consolidation) before the upsurge momentum that may affect my equity should the unforeseen downtrend persists dropping 90/100 pips suddenly

This part of your concern is all about the effective & efficient management of risk.
If at any time you’re concerned that a 100 pip move against your position will adversely affect your account equity base, then you’re trading too high a position size for your account level.

If your strategy calls for a 100 pip stop loss based on your analysis & projected safety net & it falls inside your accepted percentage risk for your account equity, then it shouldn’t pose a problem.

If however, that same 100 pip stop loss threatens an unacceptable draw down on your account balance, you need to reduce your trade size accordingly or re-adjust your trade plan parameters to fit the preferred limits.

[Edward Revy]

I've been looking with interest at EURUSD uptrend, but here is what I found, which pretty much explained my cautiousness about this trend.

http://video.forexyard.com/en/

so, be ready to react should the market starts to turn again.

Regards,
Edward