We bought the Canadian dollar and sold the Swiss Franc because price action was rejected off of a point where the 200 period SMA and an ascending trend line intersected on the daily chart and because the 0.382 level on our Fibonacci retracement tool also intersected at the same point, making this a rejection off of an area of high confluence.
We also saw price action rejected off of the 200 period SMA line on the 4 hour, the 1 hour and the 15 minute chart, again making this an area of high confluence.
The signal line on our RSI indicator was above the 50% line on the daily, the 4 hour, the 1 hour and the 15 minute chart, giving us a strong bias to go long and setting our stop loss 35 pips below the current market price and our take profit at the next clear area of resistance enabled us to get a 1.88:1 reward to risk ratio on the trade.
We will reduce the broker's edge over us by earning money from selling a currency which offers a lower central bank interest rate and buying and holding a currency with a higher central bank interest rate by way of positive swap payments, due to the the central bank of Switzerland offering a -0.75% base rate and the central bank of Canada offering a 1.75% base rate.
Our entry trigger was the formation and the close of a bullish engulfing candle on the one hour chart.
We also saw price action rejected off of the 200 period SMA line on the 4 hour, the 1 hour and the 15 minute chart, again making this an area of high confluence.
The signal line on our RSI indicator was above the 50% line on the daily, the 4 hour, the 1 hour and the 15 minute chart, giving us a strong bias to go long and setting our stop loss 35 pips below the current market price and our take profit at the next clear area of resistance enabled us to get a 1.88:1 reward to risk ratio on the trade.
We will reduce the broker's edge over us by earning money from selling a currency which offers a lower central bank interest rate and buying and holding a currency with a higher central bank interest rate by way of positive swap payments, due to the the central bank of Switzerland offering a -0.75% base rate and the central bank of Canada offering a 1.75% base rate.
Our entry trigger was the formation and the close of a bullish engulfing candle on the one hour chart.