Yen Swing Trade Analysis

February 25, 2006 by Trader Rich

TRADE

Date: Friday, February 24th

Entry: Short USD/JPY at 117.05

Reason for trade/setup: With a downward trend in motion, I was looking for a swing trade to short the USD/JPY. I was waiting for price to retrace back up where a minor Asian session breakdown occurred several hours prior at 117.10. The DMI indicator was used as confirmation that the existing trend was still in place.

Initial Stop: 117.19; the high of previous bar

Initial Target: 116.40

RESULT

Exit: 116.76

Reason for Exit: End of day

Profit/loss: +29 pips/ +$745.10 (3 lots)

Trade executed according to plan? yes

Outcome: This trade entry went exactly according to plan so much so that it surprised me. The price didn’t reach my limit and that didn’t surprise me.

Thoughts: The market doesn’t generate trades like this everyday and this setup would only apply to trending markets.