moneymaking
Short

USDJPY: BEARISH CRAB PATTERN COMPLETED ON 4 HR !!!

FX:USDJPY   U.S. Dollar/Japanese Yen
668 24 14
Hello Traders,

Here we have a BEARISH HARMONIC CRAB PATTERN on FX:USDJPY             , that has been completed. We also have a POSSIBLE RSI bearish divergence and the reason I call it a possible RSI divergence is because I DO NOT take divergences seriously unless they are proven by the market. What I mean by that is, ONLY when the market starts to break structure in the DIRECTION of the divergence, then do I take divergences into account. Therefore, the current divergence that we are seeing right now could be proven wrong by the market. We also have a decent risk to reward ratio for this setup and for crab patterns the stop loss is placed 10 to 20 pips above (for short trades) the 200% Fib extension level for XA leg. See the chart above for more details.

I would also like to point out that, for placing the stop loss I DID NOT took structure into account because if I had done that than, the risk to reward would have been quite unfavourable for us to take the trade. Thus for this particular setup, I have just followed my rules on HARMONIC CRAB PATTERN in determining the correct stop loss placement.

NOTE #1: The pattern has been completed BUT the trade is NOT ACTIVE YET !!

Please feel free to AGREE or DISAGREE with this idea by leaving a comment below. Hit that thumbs up button (top left corner of this chart) if you like the idea. Good Luck :)
Looks incredibly dangerous to short this...good luck though.
+1 Reply
moneymaking IvanLabrie
Hey Mate, yes I do agree with you on that. Trend is definetly bullish, we might see some short term relief before going higher. Thank you :)
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IvanLabrie PRO moneymaking
I don't normally trade usdjpy, but if I do I study S&P500 and FXY.
It has some limited upside, but it's there.
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Hey moneymaking, that's a good pickup on the crab, bro. But i kinda agree and also disagree. Agree because it is a valid pattern and I am also looking for this pair to retrace back down to structure. Disagree because the crab I'm looking at is up higher than yours and will complete EXACTLY at the .886 retrace of the previous major trend. But your crab's PRZ is within the completion point of my crab so overall, we actually....do agree! Make sense?

Oh, so very true what you said about divergence. Too many people see divergence and take action way too soon on it! End up getting burned and then say "See? Divergence doesn't work!" My answer is, "No, you just didn't apply it correctly!".
USDJPY: Wave 3 Has Begun.How To Catch It? POTENTIAL Bearish Crab
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moneymaking EverythingForex
Hey EverythingForex, Yes both our patterns end up close to one another, with your completing first and then mine, LOL. It completly makes sense to me now. Yeah divergence without strucutre is useless according to me. All the BEST to you mate :)
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moneymaking EverythingForex
Have a look at s&p 500, it been diverging since 2013 :

snapshot
+1 Reply
Yep, you're right. Divergence is a signal a change is coming. BUT it doesn't tell you WHEN it is coming. Like in your example, it's been "coming" for 2 years now! Anybody wanna wait that long? LOL! Better have a HUGE bankroll!

GL!
+1 Reply
moneymaking EverythingForex
HEHE, that's right. By the way, I just wanted to say that I really like that you include so much detail into your ideas. Your ideas are always full of new information, I always learn something new. You are doing a great job mate, keep it up :)
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Thanks! If people learn something from my posts, then I've accomplished my goals of giving back to this craft that has been so good to me.
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IvanLabrie PRO EverythingForex
I suggest reading Bill William's book, 'trading chaos' 1st edition.
That and Constance Brown's 'technical analysis for the trading professional' helped me figure out the use of these momentum indicators.
The amount of bars per leg matters a lot, to pick the right signals (except for RSI).
Without some working knowledge of Elliott Wave and/or something along the lines of what these books teach, I agree, divergence isn't a useful thing to monitor.
+1 Reply
moneymaking IvanLabrie
Hey Ivan, I'll definitely try to read that as well. Thank you for all your suggested readings. Appreciate your help :)
+1 Reply
IvanLabrie PRO moneymaking
Just sharing what helped me, some great reads.
Good luck!
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moneymaking IvanLabrie
Yeah, I hope to learn something from them as well :)
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UPDATE #1: Trade is ACTIVE now !!
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Agree, from my point of view this pair is making and expanded flat correcion (wave c to come)
snapshot
+1 Reply
moneymaking FullTimeTrader
Hey FullTimeTrader, yes I also think we are likely to get a correction up to the level that you pointed out, before continuing to go higher. The major trend is clearly BULLISH, this is just a correction type trade for us. Getting long on this pair near the wave c bottom would be a really good long term entry. Time to wait and see how the market unfolds from here. Good Luck mate :)
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UPDATE #1: 1st target has been reached. Stop moved to break even.
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TahirAli moneymaking
Good job mate,looks like TP2 will be hit too.I missed the entry but after today's long bearish candle,I am planning to short this thing on sunday once the market is open.
+1 Reply
moneymaking TahirAli
Hey Tahir, yeah the NFP did gave us a little scare, but with proper money management it worked out just fine :)
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This was a sweet setup
+1 Reply
KevinSinghDhaliwal KevinSinghDhaliwal
snapshot
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moneymaking KevinSinghDhaliwal
Hey Kevin, yeah it was a pretty good setup.
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UPDATE #2: Hey guys, breakeven stop has been hit. All positions based on this setup are now CLOSED. Good Trade :)
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UPDATE #3: Hi everyone, if anyone forgot to move their stop loss to break even than, you 2nd target has been hit. Congrats :)

All positions are now CLOSED for this setup. Good Trade :)
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