Trade of the Week – AUDUSD Forex / Currency Ichimoku 6 Time frame Sell . On Dec 21, 2016, we received a Ichimoku 6 time frame sell signal our iMTF™ strategy finder. Here is the email alert:
The 60m had a bearish cloud strategy so that is the time frame we are going to look for a setup. Below is the 60m chart where the blue arrow shows when the email alert was received. When the email was received, price was consolidating within a consolidation pattern. The dots near the arrow represent the iMTF™ resistance. If we took a trade at the major resistance,it would not be a good pull back trade since we it would be close to the top of the consolidation pattern.
Since we could not take the pull back trade, we evaluated the breakout entry. The Breakout entry would have to be at 0.7219, initial stop of .0.7260 and a target/preserve mode at 0.7181 which is the weekly support. This would not be a good reward/risk at all. Therefore, we could not take this trade at all.
Since we could not take a pull back or breakout, we had to wait patiently to see if another iMTF™ developed in the consolidation pattern that would allow us to enter.
At around 23:00 on Dec 21, 2016, we broke the day/swing support. The support that was broken was going to be a resistance. As a result, we setup a pull back trade with a “tight” stop. The red and green area shaded area shows the entry, initial stop, and our target.
The trade was entered while sleeping. Once we woke up, we adjusted the stop to the trailing stop which was the green dots. This was done until our target was reached.
On Dec 23, we received an alert that the target was reached. The trade was a 7:1 reward/risk.
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