EUR/CHF Interesting Currency Pair

THE EURO / SWISS FRANC CURRENCY PAIR
EUR/CHF

A very interesting pair.  One of my discoveries this week.

When the EURO strengthens the pair has the tendency to go up since the EURO is stronger than the SWISS FRANC (CHF).

When the US stengthens, the USD/CHF PAIR shoots up, therefore the EUR/CHF pair still has the potential to go up since this time around the SWISS FRANC is weaker than the EURO.

As you can see from the chart above, the light blue price overlay in the chart above is that of the USD/CHF.  If this currency pair rises, the EUR/CHF also rises even when the EUR/USD pair declines (chart below).

If the EURO strengthens, the EUR/USD rises and the EUR/CHF pair rises with it as long as the USD/CHF pair remains steady.

However, during times of extreme volatility, like during news releases,  when the US DOLLAR dives down, this pair also declines (especially this week when the Euro was stable).

These are just my observations of course.

HIGH PROBABILITY SETUP

This is the EUR/CHF Daily Chart.

As you can see, the trend line support is holding up.  More than 3 touches on this trend line already, validating support at this line.

From what I learned during my Forex Trading class, this is a high probability setup, especially if that last candle closes as is.  (Yeah, you need to wait for the candle to close).

The candlestick formation is a bullish formation called a MORNING STAR.  It might be beneficial to keep track of this pair.  It could produce a lot of PIPS even for long term traders.  Roll over rate if you buy this pair is also positive.

PERFORMANCE

Have been successful trading the EUR/CHF pair.  Caught the bounce 2x already.  The first time I earned about 40 pips, the 2nd time I earnen about 78 pips.

My equity has been on exponential decline.  Although I had success trading the EUR/CHF pair, I lost all that I gained on other trades.

LESSON FOR THE WEEK

I earned 50 USD trading the EUR/CHF pair overnight.  I should have stopped.  I continued trading for the rest of the day, in the end, I ended up losing more.  

Greed is detrimental to a Forex Trader.  

That 50 USD was already an increase of about 40% in my equity during that time and yet I wasn't contented.  Maybe it was greed, maybe I had too much time on my hands.    In Forex trading, I think the less trades you make the more profitable a trader can be, especially when you enter trades only during high probability setups.

Wanting to earn back all you've lost in a month, in a single day, is even more detrimental.  While the intention is good, it would be nice to be realistic.  While the opportunities are there, these things take time, and you have to learn to pace yourself.     

Allow enough pips for your trades to wiggle.  Still learning where to place proper stop losses and trailing stops.  I've had winning trades that where prematurely stopped due to the trailing stops.  I've also had trades where my stop losses where too close, as a result, it got whipsawed only to see the trade go in my favor after that.  

PATIENCE.

Probably the most important trait a forex trader should have.  Learn to wait for setups.  I noticed that when you got the trade right, it's not that hard to achieve positive pips.  Momentum is with you and your limits are readily achieved.  When you got it wrong though, it will drag on and take time.  The latter will tend to produce losses based on my experience.

EQUITY

Only left with 137 USD.

I gained 30 USD on the last trading day this week.  30%! (A positive way to look at things)

Traded FXCM's USDOLLAR index. Bought Long twice following the general sentiment this week due to Septaper (September Taper).  And sold the index just before news on housing sales came out.  

Almost killed myself for trading against the trend/sentiment, this last trade.  But I'm happy cause it turned out right.  

Before entering the trade I checked the charts and realized that GBP/USD and EUR/USD were already at support.  These were the major currencies that were driving/affecting the US Dollar and I realized that these currencies won't be going down any further this week and so the US Dollar was more likely to go down than up.  While my analysis might have been sound, in truth, anything could have happened.  And if not for the new housing sales data which turned out to be way below expectations, I might have ended losing this trade.

TRADING FOREX FOR A LIVING

My results may have been dismal but in an exclusive Forex Forum (Forex Club Asia) in Facebook, there are 3 members this week that have been doing quite well.

One newbie trader is trading the news and have been spot on 3 or 4 times already.  He buys 30 minutes before the news is scheduled to be released.  He trades according to forecasts.  The forecasts are seldom wrong and this trader has picked the right news to trade , therefore, he's earning pips day in and day out.  I've tried trading the news before but I wasn't that successful, I can give this a shot next week.

Two other traders have been using MACD and RSI.  One particular trader is doing quite well.  This week alone I estimated he earned 1,000 USD.  His PIP count was about 2000 pips for the week.  No doubt his capital equity was way higher than what I put in as well though.  He admonishes that you practice your trading systems using a demo account first.

Grateful to these traders for sharing their trades and experiences.  These things take TIME.  Continue to plant your seeds and the harvest will soon come.  If you don't achieve it on the first try, there will always be a second, a third, and even a fourth try.  

Pips Be With You!