Video Transcript:
Hey everyone, it’s Dale here. In this video, I’d like to talk about a trade—a long-term trade—which I took on USD/JPY. In this trade, I’d like to demonstrate that, in order to be a successful trader, you don’t need to be an intraday trader. You don’t need to sit in front of the computer the whole day and smash the buttons all day long. There’s another way—and that way is swing trading. It takes time, you need to be patient, but yeah, it pays off. And actually, this is my favorite way of trading.
So in this video, I’d like to show you a recent trade on USD/JPY. I’ll show you exactly how the trade went from the beginning—that means the reasoning behind the trade. I’ll also show you the stop-loss and take-profit placement, how the trade went, and everything about the trade so you can replicate this in your own trading and trade like me.
So let’s get started. What you see before you is the USD/JPY chart. It is a daily chart—that’s the time frame that I use for my swing trading analysis. What you see here is how the chart looked before I entered that trade. There was a downtrend, and in that downtrend, there was a newly formed heavy volume zone right here. From that heavy volume zone, the price continued downwards again. At this moment, I thought that this would be a great opportunity to join the sellers and jump into a short trade as well. The plan was to jump in at this line, so I waited for a pullback, and my plan was to go short from there.
Now I’m showing it to you like this so you don’t see the outcome—you see how I saw the chart when I was thinking about entering the trade, right? So this was the plan: wait for the pullback to that heavy volume zone, which represented sellers adding to their short positions as the price was dropping. I wanted to join those sellers, jump in here at the beginning of the volume cluster, and go short from there.
It was not just about this volume cluster—there were more confluences telling me that this was a strong level to trade from. One of them was this: there was a reaction to this level in the past, and that was telling me it was a strong support. When the price blew past that support, the support turned into a newly formed resistance. So that was another setup pointing me to this level. Another signal to go short was the first deviation of the yearly VWAP—this yellow line right here is the yearly VWAP, and those gray lines are the deviations. When the price is trending, it likes to make pullbacks to those deviations and react to them—like here, or here.
As you can see, right here where my short level was, the first deviation was very close to the level. So my idea was that if there’s a pullback, there should be a reaction to that first deviation. So what I had here were three independent setups telling me to go short from there: a Volume Profile setup, a Price Action setup, and a VWAP setup. Perfect scenario.
So what I did was place a limit order right here, and I waited for the pullback. Let me now show you what happened. The price hit the level—I entered the short—but then the price went against me. Now I think at this point I should tell you where the stop-loss and take-profit were, and what was the reasoning behind their placement.
Let’s start with the stop-loss placement. I always place my stop-loss behind heavy volume zones and also behind significant swing points. In this case, the heavy volume zone was this one, and the nearest significant swing point was this one. So my stop-loss was at the top of this swing point right here. This was the stop-loss—it was behind the heavy volume zone and above the nearest swing point.
Now regarding the take-profit: I always want to place my take-profit in a heavy volume zone, or before the price reaches a heavy volume zone. In this case, the take-profit was based on those volumes, and I wanted to quit the trade before the price reached this heavy volume zone, so take-profit was roughly in here.
Let me show you what happened. The price almost hit the stop-loss—not even here—and then the price finally started the sell-off. I was waiting for that sell-off for like two or three weeks. It took forever, but you know, the rules are rules. You just stick to your plan, you hold your trade until it reaches the stop-loss or take-profit. So I held the trade, and what happened here was that the price almost touched my take-profit—it didn’t quite reach it. My take-profit was somewhere in here, exactly 0.5 pips below this point. So I missed the take-profit—it was terrible. But I still held the trade. I didn’t quit it, because my take-profit was in here. So I held the trade, and then the price finally hit it.
As you can see, there actually was a beautiful reaction to this heavy volume zone. Let me move the chart forward and show you—this was the heavy volume zone, and right here, this was the reaction to it. So as you can see, the take-profit placement was exactly spot on. It would obviously have been better to have it that half pip higher, so I wouldn’t be stressed out and tempted to quit the trade earlier, but yeah, that didn’t happen. The price went up, fortunately enough, hit that deviation of VWAP, reacted to it, and then I was able to take the full profit in here. It was over 500 pips with just a single trade.
Now, the big lesson from this trade—at least for me—was that I should always stick to my plan 100%. Twice I felt pretty terrible about this trade. It was here, where the price went against me and was rotating above my short entry—that was the first instance. And the second one was when my take-profit got missed by 0.5 pips and there was a huge reaction. So that was the second time I just hated this trade. But I stuck to my rules, I held the trade, and as you can see, it paid off. I was able to take the full profit right here.
So the lesson is: stick to your rules—it pays off. And also, you don’t need to be an intraday trader to make money trading. As you can see, this was just one trade where I made 500 pips. How many intraday trades would you need to take to make 500 pips, right? Quite a lot.
So yeah, that was that. I hope you guys liked it, I hope you liked the analysis. And if you’d like to learn more about Volume Profile trading, then I recommend visiting my website—it’s at Trader-Dale.com. If you click “Trading Course and Tools” it will take you straight to the page where you can browse my trading education and indicator packs.
Currently, I’m running a special Easter Sale, so you can take advantage of it and get my best educational and indicator packs for a discounted price. There’s the Volume Profile Pack, Order Flow Pack, VWAP Pack, and Smart Money Pack. You can get them separately, or if you scroll down a bit, there’s a special deal where you can get all of those packs together for a discounted price.
So yeah, that’s about that. Thanks for watching the video, and I’ll be looking forward to seeing you next time. Until then—happy trading!
