EURJPY pair is correlated with EUR and JPY. So when you trade this pair you have to check what the ECB and the BOJ are doing. The good thing about EURJPY pair is that it can give you very low risk trades that have a very high reward. In this post, we are going to analyze a EURJPY swing trade that started with a small stop loss of 30 pips and made 800 pips giving us a whopping reward to risk ratio of 26:1. Take a look at the following chart!
Can you see the 2 down red arrows in the above chart? This is our entry. Our entry is 133.260 and the stop loss is 132.960. So our risk is only 30 pips. The swing trade continued for 8 days and we closed the trade at 140.960 giving us a total of 800 pips. We could have added more positions but we didn’t. We just let the trade continue. We closed it for a profit of 800 pips.
Currency trading can be fun if you keep your risk low and don’t try to make too much in a short span of time. When you have opened a trade with low risk, the worst that can happen is your stop loss gets hit. In this trade, the worst that could have happened was a loss of 30 pips. But we made 800 pips and the reward to risk was a whopping 25:1 as said above. Keep on finding low risk trades that give you high reward and you will see your account doubling and tripling.
Just keep your cool and let your winning trade run. When you are trading on H4 and D1 timeframes, a swing trade can continue for more than a week so don’t rush and close the trade. If there is a retracement just make sure that you are made your last position breakeven. This will ensure that you don’t suffer a loss. When the retracement ends, open more positions.