Trade Number 34-39 – ANALYSIS and RESULTS

Filed under: Live Trades |

Well, we had a flurry of trades yesterday and it all ended in a 2% loss on our bank unfortunately to add to a dismal month so far. However, just to show you that these drawdowns are a necessary part of the game, I want to show you my equity curve for the past six month (Figure 1). As you can see, although we are experiencing a bit of a choppy January, it is nothing unusual and we should not worry as our overall equity curve continues to move up from left to right (the graph is based on a bank of 10,000 GBP and a 1% risk on each trade).

Figure 1.

 

Trades number 34,35,36,38, and 39 were all losers. However, we did have one good one, which was trade number 37, and I would like to talk you through that setup right now.

 

Figure 2.

If you look at Figure 2, this is the daily chart for the USD/JPY forex currency pair. There is a good level of support/resistance at the bottom of the chart which price had been approaching. This was a good level to be looking out for any obvious price action setups in the form of pin bars, inside bars, or engulfing patterns. As you can see, a nice pin bar formed at this level, so I put an order in at a 50% retracement of the pin bar with a stop loss just a few pips below the low of the move. My target was three times my risk.

 

Figure 3.

Figure 3 shows that the target was met for a nice 3% rise on the bank to offset some of those nasty losses. Here are the official results.

 

Trade 34  = -107.76 GBP

Trade 35  = -96.68 GBP

Trade 36  = -99.11 GBP

Trade 37  = +303.78 GBP

Trade 38  = -87.32 GBP

Trade 39  = -93.03 GBP

 

Bank = 10,231.67 GBP (+2.31%)

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