By Ivo Luhse, founder of Evestin Forex - Follow me on social media:


Here is my GBPCHF trade analysed candle by candle.
 

Before (click on chart to expand it)

After (click on chart to expand it)

One of the keys to successful trading is you got to be aggressive when your call is correct.
This way you can build good trade into a massive trade.

Now, you are not going to find these trades every week, but once every month or two, trades like these are going to make massive profits for you. This is the only way you can survive in this game. Most of the trades will be small losers or small winners, but then BOOM, you get trade like this that will make your whole month or even a quarter.

Candle 1

On August 16, 2016 I’m looking at GBPCHF Daily (D1) chart. I see a nice long-tailed pin bar bouncing of lower Bollinger band (LBB) and last support level around 1.2520, suggesting a potential double bottom pattern. (I've marked this support level weeks in advance, after the pair created new lower low on July 6)

I like this pin bar, but I’m also looking at GBPUSD and GBPJPY on the same day. I prefer the GBPUSD Engulfing bar and GBPJPY cleaner pin bar over this GBPCHF pin bar.
It’s a close call, but I pass on this.

In hindsight, even if I would enter this pin bar, I would probably gotten out with break-even trade after the opposite pin bar on August 16. (Just to note, my two trades on GBPUSD and GBPJPY that I choose over this pin bar got stopped out, each for 1R loss)

Candle 2

On August 19, I see another pin bar that shows that this support level 1.2520 is holding. Since it’s Monday, I wait for the market open to make my final decision. (I want to make sure there is no weekend gap.  I would pass on this trade if it gapped past my entry point). There is no gap, so I’m happy to place this trade.

I use BUY STOP orders 3-5 pips above the signal candle, as my projection is that - if price breaks above this pin bar, it has high probability that it will continue to rise. My entry price is 1.2587

I typically place my Stop Loss (SL) around 30-40 pips below signal candles close or around 50% retracement of the signal candle. In this case 1.2530 is my SL price for total of 57 pips.

I don't like to use large stop loss as, if my analysis is correct, I would anticipate the price to move sharply in my favour. If the price lingers around and stays near close price of the signal candle, I would be out of this trade anyway.

I look for a take profit (TP) areas within the last swing highs or opposite Bollinger band. There are no real worry signs till we get to 1.3000 mark. Still that is more than 400 pips away, so I decide to split my order in two parts and take some profit around the swing high from August 8, that looks inviting.

To sum up my orders are:

Trade journal forex

Candle 3

On August 22, we have good strong Engulfing candle closing above the previous pin bar from August 18. This is a good sign and I like this. My first trade is in more than 50 pips in profit and there is good close on the Engulfing candle. I’m moving my SL to break-even (BE) on my first 2 orders and placing 2 new orders above the Engulfing candle at 1.2655

I don’t take any extra risk, as I have moved SL to BE on my first 2 orders. I place my SL for my second orders at 1.2595 (60 pips).

I still like the same Take profits (TP) and keep them for these orders too, TP1 @ 1.2795 and TP2 @ 1.2980

To sum up my orders are now:

Trading journal forex

Candle 4

On August 23, we have another clean bullish candle. There is nothing really in the way to reach my first target of 1.2795 that worries me, so I’m happy to go again and buy of the break of this bullish candle at 1.2717

My SL is 1.2675 (42pips) for third set of trades.
I’m moving my SL on existing positions to 1.2645 This locks in around 50 pips profit. At this point I can’t lose money even if my third set of trades get stopped out for full loss.

I keep the TP the same.

To sum up my orders are now:

Trading journal forex

Candle 5

On August 24, large bullish candle goes and hits my first target. $$$ The fact that price has hit the swing high from August 8, and retraced a bit from highs. And also that we had 3 strong bullish days in row, make me pause a bit, as I expect some stalling in this rally.
I move my SL on my existing positions to 1.2695, locking in some good profit.

To sum up my orders are now:

trading journal

Candle 6

On August 26, after inside bar day before, we have a new bullish engulfing candle. I’m tempted to take this too, but I’m discouraged that it it did not close above the swing high from August 8. Finally the weekend gap puts me off this trade completely.

I’m passing on this and just moving all my SL to 1.2745 locking in some nice profits

To sum up my orders are now:

forex trading journal

Candle 7

On August 30, we have new Engulfing candle closing above all the highs. Not a single thing in its way to 1.3000 major round number now. I like this and place new BUY order at 1.2890.
(If you’re bit more aggressive you could have taken the breakout of the inside bar on August 29, but I passed on this mainly because price hadn't cleared the swing high from August 8, at that point.)

I place my SL@ 1.2845 (45 pips) and my TP is the same 1.2980 (90 pips)
At this point I have moved my SL on my existing positions to 1.2790
 
To sum up My orders are now:

forex trading journal

Candle 8

On August 31, we have good strong bullish candle I like, but I don't enter new orders as we’re to close to my final profit target at 1.2980 The risk:reward (R:R) ratio is just not good enough to take this on. (I always look for minimum 2:1 R:R ratio)

I move all my stops to 1.2845

To sum up my orders are now:

trade journal for forex


Candle 9

It is September the 1st. I bring my daughter to her first day at pre-school. I check my phone (I get trade notifications from MT4 app) and BOOM - UK manufacturing PMI come out much higher than expected and as a result my final target at 1.2980 was hit for a massive trade and a massive profit. Few more trades like these and my daughters college fund is ready :)

To sum up my final orders look like this:

forex journal

Total profit 15.2R never risked more than 1R.
Total profit 1497 pips if you're into counting pips.

Who said August is bad month for trading?

With a smile,

Ivo :-)

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