AUDUSD Practical Exercise 7

[Ronald Williams]

I attach three charts for AUDUSD.  The 15 minute chart shows the MOR in yellow and the DOR for 6th October in green.  With the DOR above the MOR we are looking for long trades and the chart shows the Gann level 50 pips above the DOR at 71717.

I have not shown higher Gann levels on this chart because on the daily chart, which shows the position at the close of the daily bar on 5th October, you will see there is untested resistance at 71719, virtually identical to the 50 Gann level on 6th October.  This provides a very strong target for 6th October of 71687, 3 pips below the 50 Gann level.  As you can see , this target was hit later that day.

Using an entry at 71339,1 pip above the 17.30 engulfing bar, and a tight stop at 71185, I pip below the bar, would have resulted in a trade with a reward:risk ratio of 2.25:1.  71185 would also have been the logical position for a loose stop.

Even if the engulfing bar was not considered strong enough ( because it did not close near the high) it would still have been possible to profit from the 5 minute chart (chart 3).

[Ronald Williams]

I thought I had attached the 3 charts to my earlier post but apparently not.  The charts are now attached.

Attachments:

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[Rich Fitton]

Hi Ronald,

That’s a lovely example. The way the market broke through the DOR which then held as support on the retest gave a very good idea of the buying intent at work.

[Author]

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