On Aug 30, 2013, we received a Ichimoku 6 time frame Forex buy email on the currency NZDUSD. The email is shown below:
When performing technical analysis, it was seen we were approaching a major support. There was high probability we would be bouncing off this support. Therefore, we looked for a counter trend trade. If this instrument did reverse, everyone who was thinking short would be caught. In order to get a trend reversal, we looked for a trade setup on a 4 hr time frame. Anything less than that, we could be subject to some “shakeouts”.
The entry was 0.7779, initial stop of 0.7770, and a preserve mode value of 0.7836. This would give us a max risk of 9 pips and a min. reward of 57 pips. The reward/risk would be 6:1 i.e. 600%+. The chart setup is shown below.
Right now, our stop is 0.7931 in preserve mode. Since our stop if above our entry of 0.7779, it is a free trade. As the trend continues, we lock in more and more profits and our reward/risk goes higher and higher. If we get stopped out now, we would lock in 152 pips in profits with a risk of 9 pips. this gives us a 16:1 SO FAR!
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