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After seeing mixed results on the Inside Bar Momentum Strategy 2.0 in the past few weeks, stronger trends have allowed the mech system to catch a couple of wins on USD/JPY and GBP/JPY.

If this is the first time you’re reading about this strategy, I suggest you take a look at the system rules and its Q1 performance.

For the past few weeks, I’ve been running a test of the adjusted stop loss size (from the original 20% of the first candlestick to 40% of its length) on both USD/JPY and GBP/JPY and I’m seeing decent improvements for both pairs.

The past few days had four inside bar patterns but only three generated open positions for USD/JPY, and here they are:

USD/JPY 4-hour Forex Chart
USD/JPY 4-hour Forex Chart

As always, I’ve zoomed in to the short-term time frames to see if these signals were triggered and if any stops or targets were hit.

The first position was stopped out while the last two hit their profit targets, effectively making up for the initial loss.

And here’s how the signals lined up for Guppy:

GBP/JPY 4-hour Forex Chart
GBP/JPY 4-hour Forex Chart

Yep, only a couple of signals for this one! When I checked the entry and exit levels on the short-term charts, I saw that the first signal was stopped out but the second one caught a pretty big win.

In particular, the first GBP/JPY signal had a 35-pip loss while the second position had a whopping 245-pip gain. Woot woot!

Similarly, the winning positions on USD/JPY also made up for the initial loss in terms of pips, but the percentage gain of course depends on how you calculate the position sizes per trade.

As I’ve noted in my earlier update for this mechanical system, it looks like trends are starting to gain a bit more traction lately so I’m keeping my robot fingers crossed that this market environment lasts much longer. Dollar weakness and yen strength appear to be in play, and this is good for both the pairs I’m watching for this particular strategy. Stay tuned for my next updates!