I teach you how to trade the FX market using no more than simple trendlines and the Stochastic indicator. My latest trade opened this morning in the AUDUSD is presented below. First thing to note is the divergence between price action and Stochastic. Notice that whilst prices continue higher, as shown by the upper trendline, Stochastic is moving lower. This is known as divergence, and is indicative of an impending price downtrend. Secondly, note that price action has crossed below the lower trendline at around the same time that Stochastic crosses down and moves below the 80 level. This is a very clear sell signal, resulting in me selling 10 contracts. I'll keep you posted with updates.
