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” Profitable Forex Strategy Combining LONG CANDLE…..And Fibonacci Price Pull-Back ! “

In this post, I am going to share a Forex Trading Strategy which takes advantage of these 2 important elements happening in the market :

1)  A ( Solid  ) LONG CANDLE ” Breakout ” On A Daily Time – Frame

2)  And relying on a ” 50.5% Fibonacci Price Pull-Back ” to acheive a  High Probability ( Low Risk…HIGH Rewards ) entry..

Read on below as I share this profitable strategy in a step-by-step manner for You !

Before that……..let me ask You a very interesting question first…

…….That is :

What do You think would happen IF….:

….” Most of the traders ( all over the world ) actually traded in the SAME Direction as You are –  And everything happens in a really SHORT period of time ….? “

What’s Your answer to the above question …?

( It’s ok…..let me help You with it….* smile * )

Yes…………there would definitely be an Incredible & Serious BREAKOUT from the Price Movement in the forex market…

This is so because…….. there would be MASSIVE amount of FUNDS being pumped into the market at the same time SHORTING / BUYING a certain currency pair…

( or at least at very close time intervals …..)

Let me elaborate more on this for You…..


For example :


If …..MOST of the traders ( Especially those with Very ( VERY ) HUGE Funds & DEEP Pocket )…. also have the bias of SHORTING / SELLING a particular currency pair…..

And IF……….. they SHORT that currency pair just about the same time…. ( or relatively close to each others’ orders )

It means the amount of VOLUMES resulting from their ” ( Combined ) Selling Interests ” would be INSANE & VERY IMPACTFUL

And when that happens….

What is the ” Most RELIABLE & ACCURATE ” proof we traders can pick up from the forex market to confirm our trading bias ?

YES…….it is none other than a FULL – Body LONG CANDLE formation in the market…!!

These FULL-Body LONG CANDLES formation carry tremendous significant in the forex market infact…..

And could actually IMPACT that particular currency pair for days or even weeks to come….

….Which is definitely a very good news to retail traders like You & ME ! * smile *

Why so ?

Simply because upon spotting such LONG CANDLE formation in the market….

We can then get ready to place our orders and make some Valuable Profits for Ourselves then…!!


…….the best thing about such LONG CANDLE formation is that it is very ” Reliable & Accurate ” to help derive our BUY / SELL Signals…

This is especially so if such LONG CANDLE formation is spotted on the BIGGER time-frame such as the ” Daily “.

This is what exactly happens to the NZDUSD a few days back ( while writing this forex strategy to share )….

……by deploying my ” Long Candle Formation + ( 50.5% ) Fibonacci Price Pull-Back ” strategy…

I have managed to nail a nice 200 PIPS out of this NZDUSD ” Bearish Breakout “ – By relying on the LONG CANDLE formation !

So in this article, I will be showing You in a step-by-step manner of how I actually did it as well.

So without much further ado…

Please fasten Your seat belt……and let’s get started now ya !

Trust me……You are going to love this ( extremely  ) Profitable forex strategy based on
( breakout ) too…. * smile *

Unless You are one odd trader….. that DO NOT like to make profit from the forex market
( for some odd reason that is ) ……* frown *

Alright….( alright )……..jokes aside……let’s go now.


A Forex Strategy Combining ( Very ) LONG CANDLE Formation…..& ” Fibonacci Price Pull-Back ”

( Again….this is indeed another Very Profitable strategy with minimum risk….BUT Offering HIGH Rewards ! )


The LONG CANDLE formation happened in the NZDUSD ” Daily ” time-frame..

When I saw this ( Bearish ) Long – Candle…..

…..I KNOW there are really good Profits ( Pips ) awaiting to be grabbed from the market soon..

It is just a matter of ” waiting ” for the proven ” Low Risk ….HIGH Rewards ” set-up to be shown before I jump in and open a position to SHORT..

Here’s an illustrations of the exact set-up I saw on the NZDUSD to share :

Forex Long Candle Strategy

Forex Long Candle Strategy

This Long Candle being spotted is UNLIKE others in the market in fact.

As You can see on the illustrations above too….

The length is ” Exceptionally LONG “…..and with a FULL WHITE ( Bearish ) body..

Very serious implications with that…..and it definitely carries immerse amount of Weight
in the forex market..

To put it in lay man’s terms…….it means HUGE SELLING orders have been placed into this NZDUSD currency pair…

And to be exact…..these HUGE SELLING orders are attacking on the NZD currency

Why I know that ?

Simple !

Just compare other major USD crosses such as the EUR/USD, GBP/USD or AUD/USD…

And the weird thing is that I am NOT seeing such ” Exceptionally LONG CANDLE ” formation on them…

So it is common sense that NZD is the one being attacked with such MASSIVE SELLING orders…

* smile *…

Well……with such confirmation… You know how Happy & Excited we should be as retail traders ?

We should be ” Extremely Happy ” in fact….

Because when such FULL-BODIED Long Candle is being spotted on a ” Daily ” time – frame….

The Profit potentials that follow would be HUGE !

….A LOT of Valuable Pips to be grabbed by You and Me…..! * smile *

( when You know ” HOW ” …that is )

However….just like the other Profitable Forex Strategies that I shared previously…

With all that information…… is STILL NOT good enough for us to jump in to SELL yet…

You would need to wait for other ” better ” set-up so as to achieve a LOW RISK …& HIGH REWARDS potential.

And exactly what kind of the so called ” LOW RISK….HIGH REWARDS ” Set-Up that I truly want BEFORE commiting into a SELL trade then….?

Next coming up….I will be explaining ” everything ” You need to know on that …

So read on below for the exact ” Important ” details…

When such Price Breakout occurs in the forex market …..and resulting in a LONG CANDLE formation…..

…..A Trend would most likely develop too after…

( In this case, it would be a down-trend obviously since it is a WHITE ” Bearish ” CANDLE )

Here’s the illustrations to help You recap again :

Forex Long Candle Strategy

Forex Long Candle Strategy

So the very next thing upon spotting such Long Candle Breakout is to wait for the Price to ” Pull-Back / Retrace ” to a certain Fibonacci level…

Where Fibonacci Levels are concerned…..there are a few different levels namely :

– 23.6 %

– 38.2 %

– 50.0 %

– 61.8 %

– 100.0 %

A few levels for one to decide on…

Selecting TOO LOW a level……You would fear that the price would clear further and hit Your Stop-Loss…

Selecting TOO HIGH a level………it would mean it is actually a ” Reversal ” and NOT a Retracement/ Pull-back anymore…

These situations could be rather confusing if You are NOT understanding the bare essentials about Fibonacci trading tool ” adequate ” enough…..

In fact……….most struggling traders somehow already know that watching Fibonacci levels for retracement is proven reliable for achieving entry with ” low risk & high rewards “…

However……….the thing that make them confused ( most of the time ) is deciding on the RIGHT FIBO LEVELS for their entry…

So how then ?

Not very tough on this one actually…

Since we don’t want too low….

Don’t want too high either…

Then we just go for the ” median ” then….

Which means between the 50% – 61.8% FIBO levels would be a good region to watch for potential ” entry point ” to SHORT again !

As the saying goes……a picture speaks a thousand words !


Let me show You exactly how I did it with this NZDUSD trade next…..( with illustrations ! ):

Since this LONG CANDLE has been spotted on the ” Daily ” time – frame..

And now that the price is beginning to ” Climb ” up again…

I am going to drop to a smaller time-frame so that I can watch the Price Actions in a much clearer view

At the same time….monitoring ” HOW ” the Price Actions behave when they hit the 50% – 61.8% FIBO level….

Let me first show You how it looks like when I plotted the FIBO level :

( on the 4 hourly time-frame )

Forex Long Candle Strategy

Forex Long Candle Strategy

As You can also see above…

The price is still climbing to the 50.0% level..

So we couldn’t do much except to ” WAIT “….


Perhaps some of You guys would be wondering on this question too :

“…But Aaron….what if the Price DID NOT reach the 50.0% Fibo Level and it Plunged down again ?  It means we are going to MISS this move ?  ( and the profits as well since we are still waiting for the 50% fibo level to be reached  & Did NOT enter the trade….?)


I know many readers ( mostly newbies or struggling intermediates ) would be wondering on this aspect as well..

Very normal especially for those whom are new to Price Actions trading and Fibonacci Retracement Strategies..

Here’s my answer for You guys whom are wondering about this aspect :

” There is really NO point RISKING entering at a much lower level than at least the 50% Fibo level …..because most of the time, the optimum levels to watched for are the 50% and 61.8% levels…..

( most professional traders, banks and major institutions watch for that levels too ….)

In fact….any levels lower than the optimum 50% & 61.8%……the risk of getting a stop-loss hit is very ( very ) high..

On the other hand……if the price has reached the 50% & 61.8% levels ……the profit potential is much higher as compared to the lower levels..

( because the more it retraced previously…..the more it would move IF the trend continues….)

Not forgeting that the Stop-Loss needed would be much LESSER too…

Thus allowing us to achieve a  ” Low Risk & High Rewards ” ratio for this trade..

So aiming for the 50 – 61.8% region for retracement would be profitable most of time when combined with good money management + good reward / risk ratio entry !

* smile *


1)  So did the price hit the FIBO LEVELS ( 50 – 61.8% ) I wanted….?

2)  What do I ” based on ” before committing into a SELL order then ?


Let me answer part 1 first for now :

The price has indeed climbed to the levels between the 50% – 61.8% levels after that..

But it soon fall back ( lower ) again…..

Upon seeing the ” Price Hit & Fall Back Lower Again “…situation

It is already good enough to consider that the ” optimum retracement level ” has been satisfied…..

Here’s an illustrations to help You understand more :

Forex Long Candle Strategy

Forex Long Candle Strategy

With that ” Optimum Retracement Level ” satisfied…

What did I look for next before I commit my entry to SHORT this trade  then ?

Nothing complicated though……

Since the Price has reached the 50% – 61.8% levels previously…

And it is maintaining slightly below the 50% level now….

At the same time….it means it has formed a ” Lower LOW “ in the market now too..

Here’s the kind of  ” Lower LOW ” I Mean after the Price Fall Back :

( if You dropped to the next smaller time-frame which is the 1 Hourly….You can see this ” lower LOW ” even more clearly ….)

Forex Long Candle Trading Strategy

Forex Long Candle Trading Strategy

And upon calculating the Stop-Loss needed…

Based on the  ” Lower Low region ”  to SLIGHTLY ABOVE the 61.8% level..

I came to the conclusion that a 60 Pips Stop-Loss would be needed …..

( …and it is placed at a level ” strategically ” enough to avoid getting hit Unneccessary ! )

With the critical Stop – Loss being calculated..

Of course I would also need to calculate the ” Potential Rewards “ as well…

So that I can guage whether the ” Rewards / Risk ” ratio is WORTH IT after all……or not.

For the Profit Targets strategy….I will be executing exits on 2 different Take – Profit levels.

1st Take- Profit Level = 80 Pips ( which is slightly above the recent low )

2nd Take – Profit Level = 80 Pips x 1.5 = 120 Pips

IF this is a proper TREND Continuation…..120 Pips target would be hit realistically….

Simply because a LONG CANDLE breakout is ” Really IMPACTFUL “….

And there would be a lot of traders waiting to jump in and SHORT big time too ! * smile *

So considering my Stop- Loss is 60 Pips….

And Profit Potential is  80 Pips ( 1st Target )….120 Pips ( 2nd Target )…

It is obvious that I can achieve a good ” Rewards/ Risk ” ratio for this set-up…

And what do I do next then?

Enter and SHORT this trade of course !!! * smile *

Here’s an illustrations showing the details ( Short Entry, Stop-Loss & TP )  for You to understand more :

Forex Long Candle Trading Strategy

Forex Long Candle Trading Strategy

As I am executing the ” 2 Exits ” strategy for this trade..

Once the first Take – Profit level is hit ( +80 Pips )…

I will then shift the Stop-Loss for the 2nd position to the Break-even point.

This is to ensure that even if the trade were to reverse….I am still a WINNER for this trade….* smile *

Even if I am in 70+ Pips profits already …..and it’s time for me to go to bed..

I will just manually exit the 1st position with 70+ pips Profits…

And just shift the 2nd position Stop-Loss to Break-even too.

Difference of a few pips is not very important as I have already Profited from the 1st position – That is more important !

Of course….this is to ensure that I can sleep ( even more peacefully ) knowing that even if the trade reversed on me…..I am already a winner from the previous 70+ Pips Profited !

* smile *

Very essential to do what it takes to ” Protect & Secure ” our Profits for long term GAINS !

Agree ?

Alright….so how does this trade eventually turns out for me then ?

Here’s the answer :

Forex Long Candle Strategy

Forex Long Candle Strategy

Did You notice some amazing pattern of the Price Actions from the illustrations above ?

The price did NOT plunge down straight away actually..

It trades lower….and lower in a very progressive manner……UNTIL…

When the price ultimately cross the ” half-way point ” of the full retracement…

Only then the price plunged down seriously in a very INTENSE ACCELERATED manner…

Just look at the FULL ( WHITE ) LONG Candle that formed from that point onwards….

…You will be able to feel the amount of SELLING PRESSURE then too…

So bottom line is that NEVER underestimate the Power of a FULL- BODIED LONG CANDLE  in the forex market….

( Especially on the bigger time -frame such as the ” daily ” like what I spotted for this trade on NZDUSD )

I executed the exits in 2 different price levels….

1st TP is 80 Pips …( at price 0.74435 )

2nd TP is 120 Pips…. ( at price 0.74035 )

Definitely a nice amount of Pips to be grabbed from the forex market…..

And all thanks to the LONG CANDLE formation that provide me with the ” reliable & accurate hint ”  though….* smile *

Here are the 2 earnings screen-shot ( with Entry, Stop-Loss & Tp ) to share :

1st Take – Profit Earnings ( 80 PIps ) – Usd $2,410.50 Profits :

Forex Long Candle Strategy

Forex Long Candle Strategy

2nd Take – Profit Earnings ( 120 Pips ) – Usd $3,610.50 Profits :

My Important Conclusions For You :

……Since You and Me ( as retail traders ) simply DO NOT have access to any of the so called ” Insiders’ Information / Tips ” from the Government or any Hedge Funds with HUGE Funds that are capable of moving the market at will..

Hence……the only trading decision that we can grab hold of is purely from the technical analysis charts…

And with that….it is really ” good enough ” for us to make very nice and consistent profits ….each and every month from the forex market in fact…

Besides relying on the more Powerful Price Actions in the market for our analysis..

One really ” Impactful , Reliable & Powerful ” HINT to help with our analysis is by trading off the FULL-BODIED LONG CANDLE forming in the forex market…

Here’s why :

When a LONG CANDLE ” actually formed ” in the forex market……

… significantly reflects ” Huge Interests & Trading Volumes “ ……from majority of the traders..

( Especially those with ( Very ) Deep Pocket & Funds )

So any LONG CANDLE appearing in the market….

( especially on the Bigger time-frame such as the Daily or Weekly……we better treat them with a certain respect as it is giving us a very SOLID HINT of the next BIG MOVE….)

And when You ALSO ‘ Know ” HOW to trade such LONG CANDLE…..the rewards are indeed very lucrative each time…… well as in the future trading days to come !

No doubt about that ! * smile *

So if You are one such trader who ” has NOT ” master the art of trading with such ( Profitable ) LONG CANDLE formed in the forex market yet….

Then You could be MISSING out on the valuable Pips ( Profits ) on the table that is….when a LONG CANDLE formed again in the market…

( Maybe tomorrow…. ? )

Really worth spending the effort to fully understand and eventually master a trading strategy that help YOU take advantage of such LONG CANDLE …..

It could be considered one of the most ” Powerful form of Price Actions “ in the market available to You and me ( as retail traders ) indeed….

Simply because it involves MASSIVE Amount of VOLUMES & Interests that are driving the price around…

Master it….and You will enjoy the tremendous benefits in the days to come too from the forex market ! * smile *

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