Nov 7 – Nov 12 2021
AUDJPY – Zooming into the four hour chart, price had based on top of support. This is bearish. Breakdown lead to 77 pips downside. Price now sitting on our second red line and will bring this pair back for next week.
AUDUSD – The complex correction played out with 107 pips to the downside missing our projected target by 30 pips.
BTCUSD – Price broke the consolidation for a $4700 run. Remember, with Bitcoin, you are either trading it actively or looking to position and hold. We are just looking for entries to hold for these updates.
EURAUD – Price pulled back into our top red line. Zoom into the four hour chart for a trade entry. Breakdown and pullback for 88 pips downside.
EURJPY – Was looking long and price just drifted to the downside.
GBPCAD – As mentioned, this was going to be a tight trade going against the trend. 70 pip bounce long using the daily chart. Higher pips with using the four hour chart.
USDJPY – Failure test at low of range and price hit 104 pips upside. If you played a breakout of lows, keep in mind we don’t just trade a breakout without basing at support or resistance. The ONLY time this is done is as a way to enter a reversal in a pullback.
No entry in Bitcoin last week and 618 potential pips in the Forex setups. A great lesson in stop placement with GBPJPY. Tight stops would have been taken out during the pullback better seen on lower time frames. You can see it on the daily as the green candle that pulls back to the breakout level.
ADUJPY had a triangle break to the downside. My general rule with trading triangles is to go with the flow. The flow is the breakout direction. If against the trend however, the exit is quick upon any obvious intent back in the direction of the trend.
Looking for a breakout in Bitcoin as we are consolidating inside of the range of Oct.
Oct 31 – Nov 5
BTCUSD – No entry in Bitcoin.
AUDJPY – Reversal at top of triangle leads to a 177 pip drop to downside
EURCHF – Price just ranged at bottom of momentum thrust down
GBPJPY – Price broke the range and leads to 282 pips overall downside. While there was a rally after the break out (breakout pullback which some traders may wait for at the risk of missing trades), you stop loss is above the range on the four hour chart around 156.60. This is a structure stop or you use ATR.
GBPNZD – Price came into the red line zone and bounced for 159 pips potential.
NZDUSD – Price broke downside confirming the trading range you can see on the weekly chart
Late week momentum moves in Forex really threw off some of the patterns being made. 267 pips as price did little except the late week move. Other pairs are simply moving and without a clear entry, jumping into those trades is not a wise move. Pullbacks or consolidations are what we look for.
5 setups this week + Bitcoin and a good week for learning. We have triangles and ranges to help set up trades. Also, watch how the measured move on GBPNZD works out.
Oct 24 – Oct 29
- AUDJPY – Price pulled back and eventually consolidated
- AUDUSD – Price reversed with very little momentum
- EURJPY – Price came into the zone and using the four hour chart, trend line break upside hit 94 pips potential before falling
- EURUSD – On the four hour time frame, you can see price rocket from the low of the range, breakout of the highs, and then reverse. I have written before that with breakouts, a move from the bottom that rips through the top will usually fail. The failure led to 128 pips to the downside after price failed back inside.
- GBPJPY – Price made the pattern shown on the chart but no breaks to trade
- GBPNZD – On these types of trades, where we are looking at support or resistance holding or failing, the four hour chart is used. We had the basing at support which is bearish. Price then went upside and then broke through support. No trade.
- NZDUSD – Price ranged
- USDJPY – Four hour trend line break entry for 45 pips and then price failed
546 pips last week and some great lessons on using the four hour chart for daily chart setups/entry zones. Also note how when we talk about basing around support or around resistance, generally price will break through those areas. A lack of strong reaction at these levels, if they are actually valid levels, is a clue.
8 setups this week and some are going to be counter trend continuations. When trading those, ensure that you exit when price direction is turning back in the direction of the trend.
Oct 17 – Oct 22 – Updated
- AUDUSD – Great lesson on why we use four hour charts on daily set ups. On the four hour chart, you see a pullback that leads to a continuation trade on the daily. Traders are in the trader prior to the breakout on the daily. We don’t suggest pure breakout plays on your trading timeframe. Breakouts do make a great entry on a lower timeframe into a higher timeframe pullback. 127 pips
- EURJPY – Price consolidated under resistance on the four hour chart. That is statistically bullish plus there was a pullback on the four hour as well. 70 pips to highs before the rollover. This pair was highly extended and we missed that rollover potential.
- EURUSD – Failure test entry on the four hour chart leading to a position before the daily chart breakout. 73 pips upside.
- GBPAUD – Price came right into our red line and found support. Four hour entry off an outside candle lead to 82 pips upside.
- GBPNZD – Looking for continuation. Price on the four hour chart was basing around support which is statistically bearish. 194 pips to the downside
We take what we can get and this week was a shadow of what last week was. 281 pips and this past week was a great example of failures. In the CADJPY as an example, we were looking for resistance to hold. It FAILED to hold and does that mean we ignore what the chart is giving us? No.
You’d be surprised how the failure of an expected pattern can give you a trade. Another example would be a trading range. If price, at resistance, breaks through, we now have a resistance failing set up. From there, we can look for some type of consolidation to take long. If THAT fails to materialize, we can trade back into the range.
A few setups this week as many currency pairs are in current trends. When price continues to make new highs, you need to watch for reversals. Looking to trade a small consolidation as price is trending to enter, is usually a safer bet.
Oct 10 – Oct 15 – Updated
CADCHF – Resistance held and price ranged
BTCUSD – Beautiful failure test entry in the range that lead to a $7000 jump in BTC.
CADJPY – Was looking for resistance to hold and when it didn’t, it was a long setup off an inside bar for 131 pips.
CHFJPY – Same as the CADJPY. Resistance failed and inside bar long setup for 150 pips
955 pips potential last week as currencies made some huge runs. That just brings us a week where price is either extended or has turned into a trading range. This weeks setups include Bitcoin which is basing just under a pivot. Hard to get in on the daily chart when price is running so here is the chance.