Two Recent Trades That Nobody Talks About and Why I Took Them
by: Colibri Trader
Happy Friday! On Friday I usually prefer to go over some past trades or do a bit of psychological analysis 🙂 I am sure the ones that have been around for long enough know what I mean.
Today it will be the former.
Couple of weeks ago I had two separate articles about two currency pairs:
In them I walked you through the possibility of two short trades. Now, I want to walk you through the way I saw them and how I reacted. I believe that might be more useful than a psychology article sometimes!
My First Trade
My first trade was a short GBPJPY. Why I took this in the first place?
There was a daily bearish engulfing candle just below a major resistance level. Price had tried a few times the 148- level unsuccessfully. Paired with the bearish formation, I was onto something.
Let’s have a look into the 4H chart:
All the potential entries are flagged with a number and a circle. It is hard to take all of them and honestly unrealistic. But as long as you are in a few of them, you will be doing great.
As you can see from the main article, there was a bearish engulfing pattern, which gave me the initial direction. Then, I drilled down to the 4H chart and look at that sea of opportunities…
From all of the possibilities, only #5 failed. I managed to take 1, 4 and 6.
I missed number 3, 5 and 7. Number 8 already looked too close to a support level and I skipped it.
The students who have taken my course will know exactly why I have taken these steps. It is not so easy to explain in one article, but this one has definitely been a great setup.
Now I am looking at the next level at 125.00. It is critical to see if the price manages to break through the support level at 128.00. If not, we might see a bounce back, so be on the watch out.
My Second Trade
My second trade was a short EURJPY. Why I took this in the first place?
There was a two-day bearish engulfing candle formation just below a major resistance level. Price had tried a couple of few times the 130- level unsuccessfully. Paired with the bearish formation, I was onto another possible good trade.
Let’s have a look into the 4H chart:
Let’s have a look at the entries. All the numbers again show the possible short entries.
#0 indicates where it all started. I managed to take #2 and #3. They are a rejection and a two-candle small bearish engulfing pattern respectively.
I also was able to take #3 (which failed later). The move from 130 to 128 was a very clean move with no opportunities.
I re-took #4, as well, but it failed too.
I missed #5- it can happen even to the best ninja trader 😀
#6 I took, because it was just below a secondary resistance area.
Then, I managed to take #8, missing #7.
This, all in all generated 6 trading entries, from which two failed.
These were definitely much worse-off than the GBPJPY entries, but still managed to be profitable. That’s the beauty of my strategy, because it is developed to position you better than the majority of other traders and keep you longer in a trend.
I am looking at the current level of 128.00. It is a minor support and might take some time to be broken. On the other side, if this break occurs today, then the next barrier is the level of 125.50.
We might see some retracements down the road, but at least I am not seeing other obstacles before 125.50. Do you?
As I conclusion, I would like to add in that sometimes the best trades are the least expected ones. Sometimes, to be in a profitable trade means to be in a trade in general.
I hope you don’t take this literally, but sometimes the best trades are coming from surprising places.
For instance, I was so involved with DAX and US indices recently, that I almost forgot about my -JPY trades. Sometimes, trying to get into a trade desperately is a bad sign from the very beginning.
I am still glad I followed my rules and managed to get a winner week thanks to those trades. In the end that is what matters more than your “happy ego”.
To finish it off, I will say- be the trader you want to see in the mirror in 10 years time!
Check out my recent article on How to Re-Enter When You Have Missed It