This Video shows a Simple Price Action Forex Trading Entry where I used Support and Resistance combined with Candlestick Reversal to enter short on the EURUSD. The trade got stopped out at Break Even, but was aiming to make 3 to 1 reward on risk. Unlucky, but still not a loser!
Video Synopsis – Forex Trading Entry using Support and Resistance with Candlestick Reversal
In this forex trading video I was short the EURUSD. I talk about confluence of horizontal levels in this video, these are the support and resistance or static levels in the market, I talk about how to draw them and then how to use them combined with price action signals to get you into trades.
On this trade I used the daily chart, or anchor chart, to mark the important horizontal levels, I then zoomed into the hourly chart and found a price action entry, and I set up the stop loss and a take profit order of 3 to 1. At 1.3060-1.3080 there was a horizontal resistance band that was relevant on several occasions, on the fourth attempt price was still struggling to break through. Be sure to draw in all obvious support and resistance levels on your charts.
The price action setup in this video resulted as an uptrend ran out of steam once it ran into the above mentioned resistance near 1.3060. We had a one hour pin bar reversal bar that showed strong rejection of this resistance. Our stop-loss to protect our capital is placed just above the high of the pin bar; the setup is invalid if price moves above this high. For this setup I took an “at market” entry at 1.3033, I had a 40 pip stop loss on this setup, we have to make at least 2 times our risk or 3 times our risk to be profitable, so we are looking for an 80 pip or 120 pip profit. Support comes in near 1.2935, if price moves into this support we would make 2 times our risk, with a risk to reward of 1 to 2 you can make money with a strike rate of only 30% or more. This video is a good example of how I trade forex price action setups with support and resistance.