Then again, there is no room for complacency as I am treating my trading account as an investment vehicle where I am targeting a weekly appreciation of 5% for my assets. Compounding a weekly asset appreciation of 5% weekly may seem to be a small amount per week but when we project in the long term, it does give us some room and less stress to perform. Therefore, in the recent months, when this realization hit me while I was almost drifting into dreamland one night, I sprung up and started working on my laptop to project this effect of compounding a weekly gain of 5% and voila, I suddenly got an answer to what I ave been searching for and from there started planning along this strategy of growing account in a very comfortable manner. Forget the get rich fast mindset as this will bring greed and fear into the picture and in no time, when the "get rich quick" mindset, you will probably see more drawdowns than gains since the approach was wrong and this is probably a trap which most traders commit and I have to admit that I was once in this group.
When it dawned upon me that growing my assets to a desired outcome was possible with certain strategic plans in place, I was relieved that my move out of the rat race was possible and that patience was key in attaining the goal. With me writing this reflection on my blog today, I hope that it brings a certain message across to the reader while reminding myself of the path which I have started to embark on.
Having said that, this is analysis of the GBPJPY.
W1 Chart
For the whole of last week and the week before, it seems that the emotions on this pair was mixed as they were seen as dojis. The prior trend for the pair previously was predominantly down until the mid of 2010 where prices has since been seen to be consolidating, i.e. box range.
However, on the week beginning on 03 Apr 11, the candle closed above a resistance at the 137.764 region and failed to make a further move up and then came crashing down and closed below it. With this price action, there was a certain bearish implication as this is often referred to as the "Falling Off The Roof" which pointed to the pair's weakness.
Price proceeded to move later the week after the candle closed below the resistance and the closed higher for the week beginning on 17 Apr 11 which prompted further monitoring as there was no clear indication on the pair's movement.
D1 Chart
On the D1 Chart, it seems that this pair might be making resuming its downtrend as price was moving down. Then again, a close below 132.972 may send the pair down to test the 126.725 region (lower band of the box range) again.
H4 Chart
This is where things get a little interesting where it highlights the mixed emotions on this pair. Price was seen retracing upwards and respecting a rising channel while a possible bullish flag might be seen forming as price moves down to the lower band of the rising channel.
A break below the rising channel would push the biase to a bearish one.
In the case of the price action here, the Bearish Gartley Pattern was seen forming on the upper band of the falling channel and it sets up a short term selling opportunity.
H1 Chart
This is just a zoom in to see the pattern on the H1 Chart in a short term downtrend for now.
M15 Chart
On the M15 Chart, it can be seen that the price action created a false break above the upper band of the short term falling channel and failed to hold above it. With this, it also set up a selling opportunity on the completion of a Dark Cloud Cover on close. Thus, in the short term, which the pattern pointing to a bearish move, the short term view on this pair is bearish.
In this example, I did a trade on this pair on the validation of the pattern and decided to close the trade on a small profit when the move was not great initially and that the market was due to close in an hour or so. However, I have decided to post this example as it has once again highlight the importance of multiple time frames in addition to Harmonic Trading in the direction of the predominant trend.
