Trading the Forex markets on behalf of Samuel and Co Trading in Watford. I am a Technical Trader, here to take on the game and turn the sceptics into believers. Join my journey as I release weekly technical analysis and trade breakdowns – opening the floor to feedback and conversation. I look forward to engaging with you all.
In this week’s Technical Analysis Article, I’d like to update you on a couple of recent trades I have taken on CADJPY & WTI Oil. Let’s get cracking…
CADJPY – Daily
Firstly, on CADJPY from my last article – after entering, it took around 5 days for my long position to hit my take profit – which came within pips of my profit target 1! (0.382 fib level). Resulting in a 1:1 risk/reward ratio of 1% profit. The bullish momentum was short-lived at this point as the dynamic resistance of the 50ema held strong and the market began to tumble again back towards the 81.00 support zone. With the market reaching this support level once again, my eyes caught another potential set-up forming yesterday.
CADJPY – Weekly
Taking a brief look here on the weekly chart, price is fluctuating within this descending triangle formation and you can see just how strong the 81.00 level has become within this market. In fact, we’ve almost got the exact same setup occurring – this time, however, we may have some additional confirmation, I’ll move back to the daily chart and explain.
CADJPY Daily – Yesterday
So, this could potentially form one my favourite reversal set-ups – a double bottom on a daily timeframe, hitting a major support and whole number psychological level (81.00), a bullish daily doji pin candle and bullish RSI divergence. I’ll be waiting to see how the current daily candle closes as final confirmation before entering this market to the buy side.
CADJPY Daily – Today
Moving to today (Friday 31st May) – I can confirm I was unable to enter this trade. As this is a reversal strategy, the probability still favours the bears in this market, so the only way I could have placed a long entry is if we saw a strong buyer candle close yesterday after the Doji pin bar. The bullish momentum didn’t continue to strengthen and as you can see the market broke through the 81.00 zone to the downside. Moving forward I’ll now be sitting on my hands and waiting for the price to make its mind up – Will it break back into the ascending triangle formation? Or re-test the underside of the 81.00 zone turning support in resistance? I’ll be sure to keep you posted in the coming days/weeks.
Now, moving onto WTI Oil –
WTI Oil Weekly – (March)
Here is a quick glance at my technical analysis on Oil from March, I have been waiting for confirmation to enter this market short. The confirmation I wanted to see was a reaction around the 0.5 / 0.618 Fib levels along with a rejection of this ascending trendline where support would become resistance.
WTI Oil – Weekly – (Today)
Move forward to the past couple of weeks in May 2019. We’ve finally had our confirmation with a huge engulfing weekly candle that shadows the previous 2 candles, coupled up with a rejection of the 0.618 Fib level. For me, this is a set-up of dreams, having such confirmation on a timeframe such as the weekly is one of the strongest formation set-ups you can ask for as a Trader. I’ll move down to the daily chart and display my entry and potential exit areas.
WTI Oil Daily –
Taking my short position at the beginning of May after the weekly engulfing pin bar had closed – I have drawn in a Fib retracement on my chart to show you my target areas:
- Profit Target 1: 0.382 Fib (57.3) – giving me around a 1:1 risk/reward ratio
- Profit Target 2: 0.618 (52.0) – giving me around a 2:1 risk/reward ratio
Seeing as the market completely smashed through my profit target 1 area yesterday it has given me no reason yet to close this trade. Instead, I have moved my stop loss placement to risk-free and am now looking to ride the wave all the way down to my profit target 2 at the 0.618 Fib. If the market gives me any signal of a turnaround I’ll look to close out for a profit – but so far, so good…I’m holding.
Thanks for your time today and hope you have a great weekend; I look forward to your thoughts.
Disclaimer: Any statements non-factual in nature constitute only current opinions, which are subject to change. The information presented in this article is not a specific buy or sell recommendation and is presented solely for informational purposes only. Not to be taken as financial advice.