A mistake that most traders might make

26 Feb 2023

On the right is the daily chart, and on the left is the 4-hourly chart. It is a common mistake for traders that have been trading for 3-5 years and believe that the higher timeframe always supersedes the lower timeframe.

Similar to corporate hierarchy, our superior is not always correct.

There are a couple of factors that determine that. One of it depends on the overall market bias on the currency.

My Bias on the US Dollar pairs remains bullish; hence, I'm not motivated to short USDJPY aggressively when the market has a Bearish Bat Pattern formation. I would require to see a further market confirmation, like a Double Top form at completion, giving me an RSI Divergence before shorting the trade.

On the other hand, I'm waiting to long the USDJPY at 135.00 on the 4-hourly chart, which happens to be the Key Support Level.

3 Mac 2023

Nota

The Daily Chart Bearish Bat Pattern has completed