Video Transcript:
Hey everyone, it’s Dale here. Welcome to the recent trade series. In this video, I’d like to focus on swing trades that I took, and both are on the USD/JPY. So, let’s take a look at them. The first trade I want to talk about might seem familiar because I published the prediction for this trade on TradingView, and I also sent that through email to everyone on my email list. This is the prediction on TradingView, and this is the support that I had there on the USD/JPY. This is, by the way, a daily chart of the Japanese yen. As you can see, I predicted that there would be a support here, and not too long after, the price actually hit this level. Let me now switch over to the NinjaTrader platform to show you the reaction to that level. Actually, I can show you here as well, but it’s not as clearly visible as on NinjaTrader. So, let me switch to NinjaTrader.
All right. So, this is the same chart, USD/JPY, and this is the long level here. This is the reaction to that level. As you can see, it was a very quick, very spot-on reaction. Let me now show you what this trade was based on. It was essentially based on two things. The first thing was a volume cluster. This volume cluster formed within this trend, which was telling me that buyers were active here in this area, adding to their long positions, and that if there was a pullback, they were likely to defend this place. But the volume cluster wasn’t too strong. As you can see, it doesn’t really stand out too much. But there was another thing that added strength to that level, and I need to scroll back a bit now.
The thing was that the price made this huge reaction here to this level in the past. That means that in the past it was a resistance, and when the price blew past the resistance, it turned into a support. So we actually have a combo volume profile plus price action both pointing to this level. That’s why I went long from there. By the way, you can still see that I have this level here on the chart. All the members are getting these levels on their chart so they can see what I’m currently about to trade.
Anyway, that was the trade entry. Now the stop-loss placement. Let me zoom this in and talk about the stop a bit. The stop was below this pin bar right here. The number one rule for stop-loss placement is that it needs to go behind the heavy-volume zone. So it was behind the heavy-volume zone and, as a bonus, below this little swing point. That’s why the stop was here. Regarding the take-profit, I always want to place the take-profit before the price reaches a significant barrier, usually a volume barrier, usually a heavy-volume zone. In this case, this was the heavy-volume zone, and I took the take-profit here before the price reached that heavy-volume zone. This is how the trade played out. This was the take-profit, somewhere around 120 pips if I’m not wrong.
Now, that was the long trade, but before that I was also in a short trade, which was rather cool because I exited the short and right after that I entered the long both were winners. That short was based on this area, which is almost a year old. There was a significant volume zone here in a place where the price reversed. This was a sharp reversal, a very important one, because keep in mind this is a daily chart. So this was a very important place, a very important reversal, and at the top of the reversal we had this heavy-volume zone. I was trading from the beginning of the heavy-volume zone that blue line, that’s my short level. I also published that for the members of my trading course, so everybody who saw it was able to trade it with me.
That’s why I went short from there. The first barrier standing in the way was this volume cluster, so I closed the trade here at that volume cluster. And because it was a strong barrier, I went long immediately after and took a profit there as well. I’m rather proud of those trades because who wouldn’t want to catch almost the high here, exit the trade here, catch the low, go long, and also catch a high here? I caught this high before the price turned. This doesn’t really happen too often, to be honest to be that precise with the entries but this time it happened. That’s why it’s the trade of the week.
I hope you enjoyed the video, I hope you found it useful, and I’ll be looking forward to seeing you next time. Until then, happy trading.
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