MrVolcano
Long

EURJPY - Double bottomed. Heading towards upper channel

FX:EURJPY   Euro / Japanese Yen
56 0 4
Looks like EURUSD             has hit a double-bottom and may be about to show some upside. There's strong bullish sentiment and a Higher-Low and bullish Stoch divergence.

Waiting for price to break above the resistance at 113.76 before entering LONG, with a target of the upper channel around 117.39, which is a fib extn level too, so a likely place for profit taking to occur.

The same trade can be seen on USDJPY             too.
Comment: We were right to wait for a break of the sideways resistance, and price slid lower. It still seems like a valid idea overall, so we now have a good opportunity to go long at a much better R/R than we would have had before.


1hr Chart
snapshot
Comment: I was waiting for price to break the sideways resistance before going long. I placed an order so that I didn't miss the trade if it moved overnight. It was a prudent approach and ultimately the correct thing to do, however price triggered the order and then plummeted to the lows of the channel, just hitting my SL.

My theory about the upper and lower channel seemed to be holding up, so this time I took the courage to enter while at the lower part of the channel for a much higher R/R. My theory was that if price reached the upper channel again and shit down as it did before, at least I'd be 1R in profit by then and could still exit the position if I wanted to, without a loss. So thanks to this mistake, I learned a valuable lesson about it pays to take a calculated risk and get in early sometimes and take a chance. The following chart shows how....

snapshot
Trade closed manually: Price correctly rallied higher but hit sideways resistance and fell lower giving back all profits.

Manually closed out before BOJ news.

snapshot


This was a valid COUNTER-TREND trade, but with CT trades, it needs to be watched much more closely with a well defined target. Taking profits at resistance would have made good 3 or 4 R
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