Price Action fakey setup I traded in this video is a contrarian approach to trading the markets. While we are trading a contrarian setup we still want to trade the forex fakey in the direction of the dominant trend. Essentially we wait for a false break to occur and then trade back in the direction of the existing trend.
The reason the fakey is contrarian is because you are basically doing the opposite of what most other traders are doing. Instead of trading the obvious looking breakout as most amateurs do, when trading the fakey you wait for the breakout and then take a trade in the opposite direction but WITH the dominate higher time frame trend.
Once the trade begins to move in your favor you should look to trail your stop loss to lock in profit or move to break even depending on the price action situation.
We are using plain vanilla price charts in this video, no MACD or RSI or any other messy and unnecessary indicators.
New traders should only be trading with the prevailing trend, stick to time frames of 1 hour and above. The best setups occur on the 4 hour and daily charts.
The 4 hour fakey that I discuss in the above video occurred within the context of the previous days pin bar / inside bar combo setup, this added further validity to the 4 hour fakey.
I do not suggest exact stop placements or targets as these are very arbitrary and up to each individual, I provide traders with a guide for stops and targets, my main emphasis is on high-probability entries.
I do not recommend trading the news; let the price action guide you instead of trying to “out-think” the market.
This trade concluded with my position closing out for a 100+ pip profit after a favorable gap down the following Monday. I moved my stop to breakeven and let the market do the rest.