Hello everyone, I hope you’re having a wonderful week!
As promised, the blog about how I made over 30% profit in one month. The special thing about this 30% profit is that I made it by trading only one pair. And that pair is USDJPY.
In 2020 I did not take any USDJPY position and in the first two months of 2021 I have already taken two and almost a third as well. If I would have taken this third one more I would not have achieved 30% but a little more than 50%.
Last year USDJPY did not respect my entry criteria on the higher timeframes. And as all the members of The Forex Dictionary know, I attach great importance to the structure of the higher timeframes, the daily and weekly. If these are not clear it has no point to go the lower timeframes such as the 4H. We only want to take trades that we know the daily and weekly chart will back us on. You want to go to the finals with the strongest players, in trading these are the higher timeframes. Apply this golden rule and you will avoid countless stupid losses and once you are in a winning position the chances are very high that it will result in an exponential win.
This year we saw pretty quickly that USDJPY had the potential to be one of the biggest positions this year. This has now proven to be the case. I will post below a screenshot of the three positions that have been shared over the past month.
Screenshot of all positions.
As you can see, we took positions in both directions, long and short. This is the definition of knowing a pair through and through and being so neutral as a trader to have no bias. We listen to what the market is telling us and not the other way around. If it gives long signals, we look for longs. If it gives short signals, we look for shorts. This is very easy to say, but not always easy, staying neutral in the market comes with experience and with the right guidance!
The first position I shared on USDJPY was on 24/01/2021. This one I shared in the Sunday-market breakdown. This is a recording that I share with TFD members every Sunday evening. This way they can get a behind the scenes look at how I personally analyze the markets.
Screenshot forecast Daily chart 24/01/2021.
We can see a clear Head and Shoulder formation on the Daily chart (white zone). You can see the price rejecting that region with the red pin bar followed by the blue candle. This was a clear indication for us that the price wanted to continue its bullish momentum. You can also clearly see our targets. The 104.800 region was our Daily take profit (white line) and our Weekly target was 106.300 (blue line).
Screenshot forecast 4H chart 24/01/2021.
On the 4H-chart you can see that we were looking to buy at the grey region. We wanted to buy at this region because we received our Bullish M-pattern (drawing) as our confirmation to take the long.
Screenshot result 10 days after our entry.
You can see that our forecast has played out perfectly. As expected the price came back to the grey entry-region to complete the Bullish M and to continue it’s upside momentum from there. We have completed our Daily target (104.800) in no-time. The bullish run gave us a solid 16% profit.
Two weeks later, as the market has to take its breathe at one point too, I started to notice some bearish signs which I have shared on the Sunday-market breakdown from 07/02/2021. As always I focus myself on the higher timeframes first, and this is what I saw…
Screenshot forecast Weekly chart 07/02/2021.
On the Weekly chart you can see that we find ourselves at a very heavy selling region. I have marked this zone out with a blue box. You can clearly see all the bearish rejection candles. This zone has really proven itself as a heavy selling zone in the past. We always trade with the history of the pair so we will look for selling set-ups at this region.
Screenshot forecast Daily chart 07/02/2021.
On the Daily chart we look for our indication. We simply want to see a Daily red candle, this is our proof that the bears are at this region. We received this indication so after this we could go to the 4H-chart to search for our confirmation in the form of a pattern.
Screenshot forecast 4H chart 07/02/2021.
On the 4H chart we have received an impulsive break of the last higher low, indicating us that the market direction has changed from bullish to bearish. Our confirmation is and will always be a pattern. We can see a clear 4H H&S. We were looking to short the market at the grey (shoulder) region.
Screenshot result one week after our initial entry.
One day later the price approached our entry-region as expected. We received our shoulder 2 and took a short. As you can see, the price impulsed to the downside. You can really see the higher timeframe bearish momentum kicking in. This is the reason why we always focus on the higher timeframes and want to take entries around these regions because once they go, they go very impulsively. This bearish move provided us 15% profit.
Immediately after the bearish trade we saw the marker decelerate. We saw the market forming a clear deceleration box (grey region). These were all bullish signs and so, my bias switched again and I was looking for longs. I have forecasted the next long-position in the TFD-academy. This is our communication channel where I update the members on interesting positions and how I manage them.
Screenshot forecast 4H chart 10/02/2021.
Within that deceleration box we saw a big spike to the downside which closed again above the deceleration box. This is the moment where a lot of retail traders were caught at the wrong side of the market. All of the retail traders went short on that spike, which provided a lot of liquidity for larger institutes to go long! All of these were indications. The confirmation we received was a 4H inverse H&S-pattern. I didn’t take this trade myself as I was done trading for the week on the ninth of February. It is very important to follow your plan.
Screenshot result two weeks after the entry.
As you can see, we have gone to the upside very impulsively from there. How come, we went so impulsively to the upside? Remember, we always trade with the higher timeframes. If you go back to the start of this blog you can see how I’ve predicted the Weekly target (106.300). And if a Weekly Fib needs to be completed, it will be completed and it will be completed impulsively! This long-position could have gained me 34% profit but I wasn’t involved in this one personally. Glad to have shared this with our community so they could capitalize on this move!
So guys, this was the blog of the USDJPY-positions. I hope that you have learned a lot from this and as always: ‘Think different, trade different’.
The Forex Dictionary Team