USD/JPY Short Set Up

2017年10月21日

Hi Traders,

I'm looking at a short position on USD/JPY for the week ahead between the 114.000 - 114.500 level. Target is 115.000 and Stop is 114.650. If we see a break above 114.650 I remain short up until a break of 115.500 where my bias switching to long up until a failed re-test of 118.650.

My Trading Rules - How I identify trades, define my edge and manage the commercials:

First I define my 'edge' which simply means a set of circumstances that indicate one eventuality is greater than another.

My Edge: (How I decide on if I should enter)

1) Is defined as trading in the direction of the overriding daily trend (Bullish, Bearish or Neutral)
2) In a trending marketing I look for entries at corrective price structure
3) In a neutral market I trade the upper and lower most extremes of the support and resistance levels
4) In the case of a breakout I seek an entry in the direction of the break

Next I follow 4 rules for undertaking analysis: (How I spot opportunities)

1) Analysis must clearly define a 'bias' and the parameters for invalidating 'bias'
2) Analysis must clearly provide a trade set-up with entry, take profit and stop loss
3) Analysis must debunk a trade in the opposite direction
4) Analysis must factor in sentiment and fundamental factors

So now I know my edge and how to spot opportunities the next is how to manage trades: (How I decide on the commercials of a trade)

1) Take profit should be set at a key fibonacci and/or price structure level
2) Stop loss should be no more than 3% per trade (sum of total positions)
3) Entry should feature 2 or more positions
4) Entry at market is forbidden to mitigate impulse trading (I only trade via orders)