GBPUSD#1 - Missed Rally

I was watching this pair very closely when the before the big rally down. Literally keep an eye on it, as if all ready to be called into action if needed. But then came the real battle, what happened was I stayed sideline as a spectator throughout, even though there were many signals and perhaps a few opportunities presented.


Looking at the 1H chart above, first, the red trendline was broken, a trendline that has held for more than a week. When the trendline was being broken, the Chikou Span was dipping into the thick cloud, giving me the thought that it might be a strong resistance. Another thing was, there was the EMA50 (pink dotted) below the price, could be another resistance.

That also coincided with EMA200 (green line) in the 1H chart below. In the 1H chart, Chikou had broken the thick cloud as well. A clear and usually true bearish signal. The price indeed hit some resistance around H1 EMA200, which was probably another opportunity to enter, but I held back the urge, thinking it would bounce up to around cloud bottom. I actually placed an order to short at cloud bottom by then, but it was being done.

I'm not ruing the missed opportunity, but rather, a post-mortem. Should I have entered? Was I being too conservative or it was actually a right move to stay out? Or I was simply didn't study the signals enough, that's why I didn't have the confidence?

Reasons to enter:
1. Wave movement clear
2. Trendline broken
3. Chikou broke thick cloud
4. Price came out of thick cloud
5. Tenkan-Kijun crossed
6. Chikou broke its own Chikou support line (note: I realised after a reasonably long period of sideway movement, this Chikou support line or whatever it's called is a very good support/resistance range, once violated, the consequence is hefty)



I was grateful also, perhaps it was because it wasn't in a trade that I could objectively watch and observe the market movement, without too much emotional disturbance.

A blog post is not sufficient to record everything I've learn this night. But I'm glad I witnessed such an eventful night, which saw EURUSD and AUDUSD moved in similar behaviour, and DJI also closed below 10000. I'm looking forward to next week.

~~