On September 27 2022 I posted on social media @AidanFX “ SHORT/SELL GBPUSD at 1.0788 Stop Loss at 1.0848 TP 1.0668 (1:2 RR) 1.0608 (1:3 RR)“
Confluence trading is a combination of two or more trading strategies/techniques that come together and form a high probability buy/sell zone in a certain area in the market. Market patterns (Elliott Waves, Harmonic, Head and Shoulders etc.), price action analysis (Support & Resistance, Supply & Demand Zones, Candlestick analysis etc.) and indicators (RSI, Moving Average, Stochastic etc.) are technical strategies/techniques used when trading a confluence setup. The charts below show a confluence trade setup that signals a trader on which side to take the trade.
SELL Trade Setup
1. Price enters and respects the Supply Zone/Sell Zone (Red)
2. Price respects the Dynamic Support/Resistance 200 Moving Average (Blue)
3. RSI indicator moves below the 50 level signalling more downside
GBPUSD 15 Minute Chart September 27 2022
Entered the SELL trade at 1.0788 with Stop Loss at 1.0848. GBPUSD moves lower to the proposed 1:3 RR 1.0608 target and closed trade at the 1.0548 1:4 RR target for +240 pips (+4% gain risking 1% on every trade)
GBPUSD 15 Minute Chart September 28 2022
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 GBPUSD move lower. We at EWF never say we are always right. No market service provider can forecast markets with 100% accuracy. Only thing we at EWF 100%, is that we are RIGHT more than we are WRONG.
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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