GBP JPY FORECAST RESULT
As predicted in the graphs in a previous post here, the GBP JPY started to decline towards the Uptrend Line on the 4 Hour Chart as the pair begins a new Downtrend in favour of the JPY over the next several days…
ANALYSIS AND FORECAST
DAILY CHART
4 HOUR CHART
MOVEMENT ON 4 HOUR CHART AS FORECAST
FORECAST & ANALYSIS VIDEO
The reason it was expected to decline is because the Daily Chart is gradually completing the formation of a Pennant Setup. It was expected to therefore form a 2nd Resistance Point to complete the Resistance Boundary as it heads back to the Support Boundary already formed.
The ability to make this type of accurate forecast comes from being able to recognize certain Candlestick Patterns that lead to the formation of these Consolidation Setups. This allows us to spot when reversals are likely to take place to avoid trading losses and take advantage of them by trading these moves while the setup is being formed.
Now, although my Swing Trading Strategies don`t permit me to trade all of these moves such as this GBP JPY one for various reasons - (some too risky, too small, or require large Stops), the ability to recognize these patterns across all Currency Pairs gives you a tremendous skill that is in high demand and very rare in Forex Trading - the ability to Accurately Forecast the Market.
This is the most fundamental of skills that you need in order to be successful. It is the first step in being able to determine market direction and therefore the profit potential of these moves using your trading strategy. Even though I prefer and HIGHLY RECOMMEND the use of Swing Trading, the ability to predict the Daily and 4 Hour Charts is also of tremendous value to Day Traders. Once you know where the market is gonna be headed and by how much using the signals of these time frames, you´ll know exactly how much you can target each day and be better able to get out before reversals take place.
Naturally, it will require several months of practice to fully master this skill, but once you do, you`ll be a lot more confident that your trades will hit their trading targets with a Higher Rate of Success, regardless of the trading strategy you ultimately decide to use.
Duane
DRFXSWINGTRADING