Here we have United States dollar against the Swiss franc on a daily chart.
You can see that there is a downtrend that is going on since the end of last year.
So I consider it as a main trend.
Switching to the 30 minutes chart it is quite clear that during last seven-eight days, the currency pair
is trading within a range, that I have identified with this channel.
Remember that the main trend is down,
so I'm looking for short positions
and of course I'd like to open my short position near the top of the channel.
The market has formed a bearish engulfing pattern.
If I zoom in is more clear.
So I took the chance to open a short position after this bearish signal. I needed to study the entry
level, the stop loss and the take profit.
I have already my position on the market so I only need to do like this and I have all my lines here.
The entry level is quite easy.
I want to get my position right after the bearish engulfing pattern,
so I open my position right here at the 0.9675.
I want to place then a stop loss that goes above my channel,
So above 0.9690. 25 pips from here should be fine,
so 0.97 will be my stop loss. Let's follow the tips I have given to you regarding
the take profit.
So I decide to place my take profit at 0.9625.
So my take profit is twice my stop loss for now.
Then I need to analyze this take profit. Should I decrease it?
I can't see any reason to do it,
I would only have a worse risk to reward ratio.
Should I increase my take profit?
Maybe I can increase my take profit by 10-15 pips but not more than that,
otherwise it will go outside my channel.
Anyway I decided to keep my position like this.
It is going down pretty fast,
I didn't even have time to record this video,
that the couple is already down by 30 pips more or less.
Anyway we will see the results of this trade at the end.
Ok, so the trade went very well.
We started here with a short position on this bearish engulfing pattern at the top of the channel and
we ended here, getting our take profit about one day and a half later.
Well, what to say about this position?
There has been a phase in which the pair has traded in this range of about 20-25 pips but there hasn't
been any signal that my trade was wrong.
Let's check the trade on OANDA Web platform.
Here we have United States dollars against the Swiss franc and I got about 2 percent of profit, risking
only 1 percent of my account.