ETH/USD Trade Recap – Perfect Pullback Entry
Join the Team Today
Join our premium plan for exclusive FX, Commodities, Crypto, Indicies Trade ideas across various time frames for $49.99 per month
Trade Summary:
Discord Before:
- - Pair: ETH/USD
- - Entry: 4290.21
- - Stop Loss: 100 pips
- - Take Profit: 200+ pips
- - Timeframe: 15-Minute (Intraday Trade)
Trade Analysis:
- - Perfect Pullback Entry: This trade was a textbook pullback entry. The price was in a strong bearish trend, consistently forming Lower Lows (LL) and Lower Highs (LH). When the price retraced to 4290.21, it offered a perfect entry point to sell, as it aligned with the key resistance zone and provided an opportunity to enter at a higher price before the downtrend resumed.
- - Trend Followed: The market had broken a significant key structure (previous support or trendline), signaling a continuation of the bearish trend. The pullback to 4290.21 was just a temporary retracement, allowing for a great entry in alignment with the overall trend.
- - Risk Management: Proper risk management was crucial here. With a 100-pip stop loss and a 200+ pip take profit, this trade provided a solid risk-to-reward ratio, ensuring that the potential reward far outweighed the risk.
Moving Stop Loss to Break Even (BE):
- - After the price moved 50 points in your favor, it was a good idea to move the stop loss to break-even. This protected the trade and turned it into a risk-free position, allowing you to focus on letting the trade develop without the worry of losing your capital.
- - Momentum Confirmation: The 50-point move in your favor confirmed the continuation of the bearish trend. By adjusting your stop to break-even, you gave the trade room to run without the risk of a loss, ensuring a stress-free experience.
Psychology Behind the Selling Area:
Before:
This was a psychologically sound selling area, backed by both technical analysis and market sentiment:
Higher Timeframe Trend: The overall market sentiment was strongly bearish on the higher timeframes. This gave a psychological edge, as trading with the prevailing trend increases the likelihood of success. It provided confidence that this pullback was likely just temporary before the downward move continued.
Resistance Zone: The entry point at 4290.21 coincided with a key resistance level. Traders who followed the higher timeframe trend would have identified this level as an ideal area to sell, further increasing the probability of a profitable trade.
Market Psychology – Selling Into Strength: By selling into the resistance area, you capitalized on the market’s psychology. Retail traders who had bought the earlier rally were likely trapped, while institutional traders, who typically follow the trend, were ready to push the market lower.
After:
Key Takeaways:
- - This was a perfect pullback entry in alignment with the larger bearish trend.
- - Proper risk management ensured that even if the trade didn’t work out, the loss would have been limited.
- - Moving the stop loss to break-even after 50 points in your favor made it a risk-free trade.
- - The psychological advantage of trading with the higher timeframe trend provided confidence and clarity in your decision-making.
Discord After:
This trade was a great example of discipline in action—waiting for the right entry, managing risk, and trusting the larger market trend. By staying in tune with both technical analysis and market psychology, you were able to maximize the probability of success.
