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Inverted Head and Shoulders Patterns

Inverted Head and Shoulders 71% Win Rate

Inverted Head and Shoulders 71% Win Rate

Inverted Head and Shoulders 71% Win Rate is the outcome of the inverted head and shoulders patterns from the daily chart in the first trimester of 2020.

The premise

We are in April 2020 and this is the perfect time to look back into the first trimester of 2020. We need to analyse our results, no matter how good or bad they are looking. And, we must come to a conclusion from which we can learn how to improve our trading. Therefore, let’s take a look at what I did in the first trimester of 2020.

What Inverted Head and Shoulders Patterns did we have?

AUDCAD loss -0.3% for a risk of 0.5% (half of my initial risk).

#MMM win +0.01% for a risk of 0.5% (almost breakeven).

Bitcoin win +0.5% for a risk of 0.5% (It could’ve been +1.5% but I chickened out. You can read more about it inside the bitcoin article).

USDJPY breakeven 0.00% for a risk of 0.5%.

USDRON win +0.5% for a risk of 0.5% (It could’ve been +1.5% but I did exactly the same thing. I closed my trade way to earlier as I explained in the USDRON article.).

LTCUSD win +0.5% for a risk of 0.5% (It could’ve been almost +2% but, I did the same. I chickened out. You can read more inside the LTCUSD article).

USDCHF loss -0.5% for a risk of 0.5%.

How these statistics looks like?

We have 5 winning trades and 2 losing trades which means 71% win rate. Also we have a +1.51% gain for winning trades and a -0.80% loss for losing trades. Therefore, the net gain is +0.71%. Also, the risk reward ratio is 1:1 which is pretty bad.

What can we learn from these inverted head and shoulders patterns results?

If you take a look at my results you’ll see that it’s not good at all. The main reason why I only got +0.71% is because of me. Why? Because even if I had at least 1:3 risk reward ratio at the moment when I placed my orders, I chickened out and I closed them way to earlier. Therefore, I left into the market +3.5%. So, I am the only cause for which instead of +4.21%, I got a shameful +0.71%.

The conclusion

Now that I saw what I did wrong, I need to move on and to change something. What do I need to do? I must let my trades run. Period. There is nothing good about closing my trades earlier. The statistics show me that I can’t improve my results if I always find reasons for closing my trades earlier. On the contrary, I make a lot of bad to my trading when I chose to close my trades earlier. I invite you to also read about Head and Shoulders Patterns 64% Win Rate. And, you might be interested also in Cup and Handle Patterns 17% Win Rate and Double Bottom Patterns 45% Win Rate.

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