Update to AUDUSD Trade 6 Feb 2019

Note the approximate entry and exit points indicated on the chart.

This is the chart of the AUDUSD on 6 Feb 2019. There was a break of the support level at 0.7235 and both a H4 and D1 close below this level on 4 Feb 2019. The trade was placed soon after this break with a sell limit at 0.7235, SL = 0.7255 and TP = 0.7135.

Initially, my concern was that the price would not retrace enough for the order to go through. The break through the level was quite strong with a larger candle than the previous one. However, the order did go through after a price spike upwards. This was due to the RBA (Royal Bank of Australia, Australia's central bank) statement on 5 Feb 2019. Now the trade was negative, which lead to me second guessing my entry.

I finally decided to trust my analysis. I left the trade alone. (Don't look at it every hour!) After the price spike, it resumed its downward trend. Soon after that, on 6 Feb 2019, the price accelerated downwards and reached the profit target.

I chose to set a 100 pip target even though there's a possibility that the price could continue to move lower. Based on the wave counts, this movement should be part of wave 3, usually the largest part of the 5 wave count. However, I've learnt to take my profits when I can and a 100 pip move is nothing to sneeze at. There may be an opportunity to enter this trade again in the near future once wave 3 is complete. I just need to wait for the right opportunity.