Our winning patterns for week ending 2020-11-27
EURGBP broadening wedge on the 1H chart. Here we have classic pattern – wedge. This week we traded this price formation three times. Wedges are great as they usually show direction of the next trend. Images below show broadening bearish wedge and we used it to open Long position. Our entry point was not only bottom of wedge but, at the same time, support for bottom on 11/11/2020.
We base our strategy on S-V3 indicator, so we checked pattern against oscillator and find out that S-V3 was showing oversold level. This signal was good confirmation, so we entered trade.
EURUSD Resistance on the 1H chart. This trade was on the edge of triggering stop-loss. We opened short position in the place where 2-weeks resistance was converging with overbought signal from S-V3. As usual, we set SL and TP, and then the price went against our position. If you trade regularly, you know it is nothing unusual. Key to success is to set SL high enough to withstand price swings. After 3,5 hours going up, price reversed and started to drop as expected. Rest is only waiting for TP to be triggered.
USDJPY Support on the 1H chart. With this trade we would like to point on very high positive correlation of USD index and USDJPY. When you look on to dollar index, you notice that S-V3 is on the bottom of both charts. This is a fantastic time to enter the trade on Long side. Few hours of slow start and then explosive move up which closed our position in one move.
EURGBP Broadening wedge on the 1H chart. Here we have same wedge as at the top of the page. The only difference is that it is Wednesday, not Monday. This situation illustrates how great wedges are for trading. If You spot one on the chart you can milk them like cow. Just wait for price to drop to bottom of wedge or to reach top of the wedge and trade opposite. We always use S-V3 for confirmation of signal. Here is no different. As soon as price hit top of the wedge and S-V3 was showing overbought, we opened short position.
USDJPY Broadening wedge on the 1H chart. Another wedge this week. This one is very wide but still can be qualified as broadening wedge. If you were quick, you could trade the top twice. We weren’t and traded this price formation on a second attempt to break out. S-V3 gave us good confirmation so the only thing which left to do was to open short position. As usual, we only go 200-300 pips to make sure our position will be closed automatically.