On September 7 2023 EURJPY was showing signals that the pair would extend lower. Below I will explain the reasons why I entered SELLS.
Sell Trade Setup
1. Price breaks below the internal structure higher low black line (MSS/Market Structure Shift) signalling bearish weakness.
2. Price sweeps the September 5 2023 high for a liquidity grab fuelling the sell side. (Blue line)
3. Price enters the 1 Hour bearish supply/selling zone. (Gray box)
4. Bearish divergence pattern forms on RSI signalling a price reversal lower. (Red)
5. Stochastic indicator in overbought levels signalling a move lower. SELL trade triggered after the bearish candlestick close.
EURJPY 1 Hour Chart September 7 2023
Entered the SELL trade at 158.40 with a 35 pip stop loss at 158.75. EURJPY moves lower and tags the proposed 1:4RR target at 157.00 but I closed sell trade at 157.17 1:3.5RR Target for +123 pips +3.5% gain (Risking 1% on every trade).
A trader should always have multiple strategies all lined up before entering a trade. Never trade off one simple strategy. When multiple strategies all line up it allows a trader to see a clearer trade setup. If you followed me on social media you too could have caught the EURJPY move lower.
Of course, like any strategy/technique, there will be times when the strategy/technique fails so proper money/risk management should always be used on every trade. Hope you enjoyed this article and follow me on social media for updates and questions> @AidanFX
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