Slow Day; Experimental Trades With Shocking Results.

Posted on March 13th, 2008 by Yours Truly under Forex

Well well, nothing going on lately with regards to high probability trades so I decided to experiment on a demo account regarding HectorTrader’s dynamic resistance area.

If you don’t know what the area is, it basically consistutes the area between the 30 and 50 SMA where most positions reverse to the direction of the trend. In this instance, I basically took trades early that were in the reisistance area at the first sign of a bar into the direction of the trend.

Example #1:

I took this trade based on the 4-hour chart on the AUD/CHF pairing while the pair traded at the dynamic resistance area where it breached the previous weeks support. At the time of this post, this pair is up +120 pips and has reached the second resistance area at the bottom blue line.

Example #2:

My second experimental trade was similar to the above trade as in taking the position early into the trade when the pair is trading within the resistance area. The results were again positive with +120 pips at its peak and the pair traded all the way to the previous resistance area before pulling back and now looks like a head and shoulders pattern which may be heading back to the dynamic resistance area.