makuchaku Trade setup description : Sell EURNZD
Price on 4H has very recently rejected off a Daily bearish OB- and has formed a bearish OB- in the process. I look to trade that with a clear liquidity target of equal lows. The trade setup is invalidated if price dips below equal lows to collect liquidity before giving us an entry.
Direction Bias
Even though W/D are UP/In-range, I am taking this bearish trade because price has just rejected off a daily bearish OB and has seen a very clear break down. Moreover, we are in a range on Daily & Weekly – so sell from premium, buy from discount.
Trade setup confluences
- 4H rejected off a daily bearish OB-
- Price has created a failure swing high / OB- on 4H
- Trade zone is in premium area
- There’s a clear liquidity cluster of equal lows which should serve as our 3R profit target
Update : 17 May 2021
The trade got triggered overnight – but the price did not even blink and it completely rammed through my stop loss, handing me a -1R stop loss.
My learnings
- Not many full body candles were in the trade zone – hence not many orders present
- EUR pairs are generally in uptrend. Selling an EUR pair was probably not a good thing right now
- I should use a live confirmation to get in the trade (for example a breaker forming as my zone is touched)
