During the last Best Practice class, I guided the students through an analysis of CADJPY.
The outcome of the analysis is that we were looking for an opportunity to BUY, why?
- Based on the H4 boxes, it is an uptrend
- Price was supported by previous boxes highs and low which act as a support level.
There was already a trigger the day before.
A 1234 pattern had already formed and price had already met a WR trigger criteria. We were looking for an opportunity to enter on a 13TL trigger.
However I warned that price had to clear past a resistance level before it can go up further.
Price turns exactly at the level predicted
The next day, I posted the below tweet attached with a chart.
— Jerome Lee (@jeromlee) September 18, 2013
Positive profit turns negative
Price started to go back down after it was resisted. My own thoughts at this point was to hold onto the unless i was stopped out. It was not easy to see your profit drop to zero before proceeding to negative but ultimately i held on.
Price shoots up the day after FOMC!
During the day after FOMC news was released, some students were looking at the level predicted together in class.
Price finally shot up to my target profit point, 120pips gained based on WR trigger entry.
Why did I take profit there? Reason is simple, there was a strong resistance on the D1 chart.
Breaking it down into parts, the Best Practice way
Doing analysis need not be difficult process. You just need to break it down into parts. For my trades, I use the steps taught in Best Practice.
- H4 Boxes: Are they Up or Down?
- Is there a strategy? BM, WRMB, H4R or H4T
- Identify the Trade Zones: Where is the most likely place for an opportunity to appear? Where is the trigger?
- Identify the TP zones: Is there any support or resistance levels or zones that can turn the trade? These are area to do trade management.
Sometimes its better not to over complicate and keep things simple.
Last time, many things that I wanted were just dreams, now I see them as possibilities. I’m looking forward to own pent-house suite in Manhattan overlooking Central Park because forex trading with Tflow® makes it possible. Find me on Google+