Aug 06, 2014 04:36:08 AM EST, we received an Ichimoku Forex 6 time frame buy email alert for the EURCAD currency. Here is the email alert:
The email shows that everyone i.e. day traders, swing traders, and the long term traders are thinking this currency is going to go up. We have an Ichimoku setup on the the following time frames: 10m, 30m, 60m, 120m, and Daily. If you look at the 60m chart, you will notice it is consolidating so the only trade you can setup is a breakout. Here is the chart:
Notice, the currency went down opposite to the buy signal! What happened? Think about it! If everyone is thinking bullish and if it breaks the support, everyone that was bullish is going to panic and start to sell. This is what causes the big drastic movement down.
This is exactly why we show trading opportunities, not the exact buy/sell signal. On this trade, you should be setting up the breakout entry but you should also be putting an alert at the support. If the support is broken, you should be looking for a bearish setup right away on the lower time frames for a quick movement down (day traders). In the case of the 60m, chart, the major support was the green line, Kijun Sen at 1.4648.
When you get an multiple time frame email alert, you should be setting up for both scenario. Entry on one side and alert on the other side. The email alerts show you have the instrument “cornered” and now you have to wait for price to tell you which way it is going to go!
EDUCATIONAL USE. Commodity Futures Trading Commission, Forex, Futures, Equity and Options Trading has large potential rewards, but also has large potential risk and may not be suitable for everyone. You must be aware of the risks and be willing to accept them in order to invest in these markets. Do not trade with money you can not afford to lose. This is neither a solicitation nor an offer to Buy/Sell. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this document. The past performance of any trading system or methodology is not necessarily indicative of future results. All information provided on the Blog is for educational purpose.