Even after the New Year, of course Dow Theory was still alive!
Hello today!
FX Research, Satori here.
Well then, the year has started and a few days have passed.
Dollar/Yen is in an upward market, isn’t it?
The figure below is an example of a pullback buy on USDJPY 1-hour chart at the 0.382 Fibonacci level.
http://livedoor.blogimg.jp/fxmt4indicator/imgs/f/0/f0576dc0.gif
In the above figure, the entry was made once and take profit at the previous high would have been +26.5 pips.
Now, how about the 15-minute chart?
The figure below is an example of a Fibonacci 0.382 pullback buy on the 15-minute chart.
http://livedoor.blogimg.jp/fxmt4indicator/imgs/6/6/660bbbf9.gif
Even after the year has turned, Dow's theory was alive, wasn’t it.
It is forming an uptrend while making higher lows.
On the 15-minute chart, it moves about 10 pips at a time, and with 7 consecutive wins there was a profit-taking opportunity of +71.9 pips.
http://livedoor.blogimg.jp/fxmt4indicator/imgs/5/a/5a7cccdc.gif
Dow's theory is indeed the basis for forming a trend, as you can see.
However, trends eventually reverse, so it is necessary to use discretion to cut losses early and minimize losses.
Also, if you want to limit risk in one trade and take profits in small increments, using the 15-minute chart might be good.
The indicators used in today’s test are as follows.
Fibonacci Retracement Indicator – Push Up
http://fxmt4indicator.abproducts.biz/wp/?page_id=2255
Thank you again for reading up to here today.
