Skip to main content

A New Counter-trend Resistance on USD/JPY

A New Counter-trend Resistance on USD/JPY

The USD/JPY is from the longer-term perspective in an uptrend. There were signs of strong and aggressive buyers pushing this pair upwards.
More about this in my Weekly Trading Ideas video:
A Risky Situation on the USD/JPY
For many days there were only aggressive buyers but no aggressive sellers. This changed in today’s Asian session when Bank of Japan Monetary Policy Statement came up.
It is not really important what the statement said. Important is what the chart did as a reaction
USD/JPY, 60 Minute chart:
Whenever I see a strong and aggressive buying or selling activity (like those areas marked on the chart), I am very interested in volumes around those areas.
So today, there was a strong selling and I was interested in the rotation which took place before the selling started.
I used the Volume Profile indicator to look into this rotation area to see how volumes were distributed there.
USD/JPY, 30 Minute chart:
There was a huge amount of volumes accumulated in the rotation area.
From this Volume Accumulation area a strong sell-off started.
What this means is that strong sellers were building up their selling positions in the rotation, and then they pushed the price aggressively down into the sell-off.
----------------------------------------------------------------------------------------------------------------

Do you want ME to help YOU with your trading?

Join one of my Volume Profile Educational courses and get my private trading levels, 15 hours of video content, my custom made Volume Profile indicators, and more!
Click Here 
---------------------------------------------------------------------------------------------------------------- 
 
This is a standard setup I like to use in my everyday trading. The setup is called the Volume Accumulation Setup.
If you look at the picture, then the place with the heaviest volumes (where the profile is the thickest) – is a strong RESISTANCE.
I marked the level and highlighted the price (110.18).
So when the price hits this level, the sellers who accumulated their volumes around 110.18 should become active and start pushing the price down again.

Trading against the trend

There is one risky thing though. An important thing you ALWAYS need to pay attention to. The thing is, that if you go short from the resistance (110.18), you will trade against strong long-term uptrend. And this is always risky!
What I have to say to this is that there is no perfect and ideal trade. There is always some kind of risk. If there wasn’t, then everybody would be a pro-trader, right?
Anyways, it is up to us traders to tell whether the risk is worth the reward.

How I handle trading against the trend

If you ask how I trade such counter-trend trades, then what I do, is that I secure my position as soon as I can – by moving Stop Loss to the Reaction Point. When going counter-trend it is usually after the price made a 7 pip reaction. Also if the price turns little bit before the level and makes a reaction, then I am more prone to discard the trading level and let it be.
---------------------------------------------------------------------------------------------------------------- 

Recommended Forex Broker

Having a solid broker with low spreads and commissions is ESSENTIAL for PROFITABLE TRADING! Check out my recommended brokers
RECOMMENDED BROKER 
----------------------------------------------------------------------------------------------------------------  
Happy trading!
-Dale

Comments

Post a Comment

Popular posts from this blog

5 Character Traits of a Successful Trader – Tips & Tricks of the Pros!

 Maybe you are interested in trading, and you have taken the first step by researching on forex trading. You might also be currently trading but going through a tough time with your results in the markets and dealing with the recurrent autosuggestion, telling you how this journey might not be for you or you are not capable of achieving successes in this journey. It is essential to know that you are not alone in this feeling, and before you fall into the rabbit hole of depression, feeling like a failure in yet another skill you have chosen. Let me make it clear; the answer is YES, anyone can achieve success in trading , including you. It would only cost you a few character trait adjustments. Before we delve in, it is vital to point out that success i...
8 comments
Read more

Recent Trade Breakdown: Combining Price Action & Volume Profile for Smarter Trades

Video Transcript: Hello everyone, it’s Dale here. In this new video series, I want to break down my recent trades. The goal of this series is to show you how I use my Volume Profile trading setups every day in real market conditions, so you can learn from both my wins and my mistakes. If you find this helpful, don’t forget to hit the like and subscribe buttons. Let’s dive in. What you see before you is a screenshot from my session yesterday. It’s taken from the live trading room we held in the  Funded Trader Academy . During that session, a new setup was forming on the  AUD/USD . This is the  AUD/USD  on a 30-minute timeframe, and the new setup was forming right here. There was a resistance level forming around  0.6364 . The reason behind this setup was based on a couple of factors. The main reason was a Volume Profile setup. If you look here at what I’ve highlighted, this area represents a heavy volume zone, which the resistance level was based on. You can see ...
Post a Comment
Read more

🎯 Top Volume Profile Levels to Trade This Week – 11th November 2024

Do you want ME to help YOU with your trading? Learn my proven Volume Profile & Order Flow trading strategies! Get my proprietary indicators and start making progress. We even set the indicators up for you so you can hit the ground running TODAY! Start Learning to Trade Now! Video Transcript: Hello, everyone! It’s Dale here with a new weekly trading ideas video. What you see before you is the chart from NinjaTrader 8 platform with my custom-made Volume Profile and VWAP indicators. This is the chart of  EUR/USD  on the 30-minute timeframe. I am strongly short-biased on the Euro because I see a strong sell-off as a reaction to the election. This strong sell-off, combined with the fundamentals of the U.S. presidential election, suggests that I should focus more on shorts for this pair. This means I use the Volume Profile over the recent area to look for significant volume zones. If you examine how the volumes were distributed this past Friday, there are two significant volume ...
Post a Comment
Read more