i entered a long trade see chart i use the following moving averages 3,8,20,50,100,200. the main use of these is as context and as reference points;there is no magic with them and i do not expect any such attributes. What do I mean by reference points?:In the chart you will see eurusd move past the 200 ma [maroon/brown] ,come below it, move above it again and then test it. The move after the test was reasonable,not ideal,because it took two bars to test the nearest high, and it shows that buyers are not enthusiastic.So i have used the 200 ma as a reference point we are in asian session,this is a move up, after a very sharp down trend so sellers are more confident, and this has a pull back 'look' to it . So overall the market appears to be testing higher level, rather timidly i may add,so it is probably because the large sellers are not selling,because of these low levels,rather than because of buying by the big boys . The big sellers may return after the London opening so till that time it may be safe to go long. The PRICE ACTION on the other hand is not very bullish,with a lot of overlapping bars, deep retracements, and with sellers coming in, at every high. HOWEVER sellers are not coming in at lows so market is making higher high and higher lows.so sellers have not been able to drive the market lower. all this means it is not an ideal long trade. why did i then go long: i went long mainly because of the 200 ma being broken. And also because the last big swing down was totally retraced by the first swing up.This is a sign of some bull strength; this 'double top' is a sell signal in some systems but i feel that, if the bears were really strong, they would not have allowed the bulls to come close to the high and the market would have formed a lower high. This is why a lower high formation is there fore a far more strong sell signal than the double top. This is also why you will find that most double tops and double bottoms will be broken. I EXPECT THE DOUBLE TOP in the posted chart to be eventually broken. After listing all this i feel i could have/should have waited for some time. i am still trying to learn despite my grandiose screen name.
the size of these trades is tiny: i have lost over 100000 usd i am the worst trader in the world I am still trying to learn in spite of my grandiose screen name
in a different thread OP you said you started in 1994 and still can't turn profit... now I know why.. this text book TA stuff with a bunch of lines... they are useless. you are just trading market noise.
you are right the brown line ,200 ma was flat, so the market going above was, just a move in a trading range ...... just noise as you put it