Stock Market

JPY Troubles for OANDA:USDJPY by xAverageJoex

The Situation-

It was going GREAT…. Until it wasn’t…

I mis read the trade, and got it wrong with a bad entry, then another, then another.

I made that entry worse trying to move out of the position at breakeven before close of the week

Managed to recover half of the drawdown amount through scalps, then after some “analysis fatigue” it got a bit worse, so I hedged out to go through the weekend and observe the open for a possible outcome:

The Plan:

I’ve selected a few levels and target points for few different outcomes, but with an overall short Bias.

Plan A, & Plan A Alternative:

Should price open and move up, I will look to close the buys (3 separate units, Blue Arrows) around Point 2, making a net profit of 84 pips. Point 2 has some support and resistance within a short span of time, so it’s a little questionable, but I will be waiting for some rejection before entering a second sell from this level (3 units), as I already have a slightly higher order count than I should have because of some scalps that didn’t fully work out, so make sure before entry.

If there is no rejection, or not much rejection, I will re-hedge up to the next level at Point 5, where there looks to be significant resistance. This will also secure another 270 pips (90 x 3 units) of profit if it makes it, otherwise will watch to see if it will reverse before to close premature, but the safest play would be go to the level or close the additional hedge at break even.

I expect the price to likely follow the idea of coming up to Point 2, get some volatility , then drop, clearing the sell trades at breakeven, and then look for a new fresh opportunity.

Plan B:

Price naturally opens down with the trend outlook in play, dropping all the way to Point 1 below at a key level. At that point, I will liquidate the sells for a net gain of roughly 360 Pips (120 x 3 units)

I will then immediately enter a buy sell from this level, Looking to close back above revisiting the level around Point 4 with a pullback. Just above halfway between Point 1 to Point 4, so any natural retracement should be able to clear out the buys near breakeven or small loss, before turning back down. Once the Buys get cleared (Breakeven or slightly better, as I’m expecting price to continue running down fairly quickly (just my experience of the nature of the JPY)

Hedge Protection for any new positions:

Fixed around 25 Pips beyond any buy or sell in the opposite direction, with major levels as targets for new hedges. This will allow enough space for the hedge to benefit the equity in an advantageous way to cover any new positions of correction with boosted free margin, and give plenty of possibility for meeting in the middle of a level quickly to breakout of some positions without much loss, but preferable and most likely for break even for either set of directions, with significant gain if major levels make it into the outcome. Plan B will give the most gain, but I am not looking to force the market, only make a success with what is presented while protecting the account from further mistakes on this trade setup.

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