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Wednesday AUD/JPY Strategy

Wednesday AUD/JPY strategy — this trading system exploits the certain tendency of AUD/JPY currency pair (Australian dollar vs. Japanese yen) to be statistically bearish during the pre-last hour before the rollover interest is applied on Wednesday. The particular day of the week was chosen because on Wednesday the rollover is tripled compared to normal days (Sunday and Saturday interests fall on Wednesday). It's unknown why AUD/JPY, a pair with a traditionally positive rollover interest, is sold 1-2 hours before the overnight swap is applied. Perhaps, traders (hedge funds) with big bullish positions prefer this time to partially close their positions without bothering the markets too much. This strategy has been implemented in a fully automated expert advisor for MT4/MT5 platform.

 

Warning! According to the latest tests of this strategy on the period from 2008-07-07 through 2014-01-24, it is no longer profitable leads to significant losses. Do not use this strategy on a live account! Use for educational purpose only.

Features

  • Fundamental base for trading.
  • Very simple strategy.
  • Statistically perfect.
  • Only one trade per week.
  • Jump-like changes in the interest rate may affect it.

Strategy Set-Up

  1. Trade only on Wednesdays.
  2. Open an hourly chart of AUD/JPY pair.

Entry Conditions

At 15:00 EST (GMT-5 or GMT-4 during daylight saving time) open a Short position.

No stop-loss or take-profit.

Exit Conditions

When the new bar opens (16:00 EST) close your position.

Example

Wednesday 2009-10-14 Wednesday 2009-10-21
Wednesday AUD/JPY Strategy 2009-10-14 Example Chart Wednesday AUD/JPY Strategy 2009-10-21 Example Chart
Wednesday 2009-10-28 Wednesday 2009-11-04
Wednesday AUD/JPY Strategy 2009-10-28 Example Chart Wednesday AUD/JPY Strategy 2009-11-04 Example Chart

The example charts show last four Wednesdays (October 14, 21, 28 and November 4, 2009). The H1 bar that occurred on 15:00 EST is marked with the red ellipse. I've checked each Wednesday from January 7 till November 4, 2009 and the statistical gain from selling during that hour was 400 pips after 44 weeks. That's ~9.1 pip per deal, which is above the average spread for AUD/JPY (5 pips). Of course, there are some Wednesdays when the strategy results in a loss, but in a long run, it's profitable.

Warning!

 

 

Use this strategy at your own risk. EarnForex.com can't be responsible for any losses associated with using any strategy presented on the site. It's not recommended to use this strategy on the real account without testing it on demo first.

Discussion:

Do you have any suggestions or questions regarding this strategy? You can discuss Wednesday AUD/JPY Strategy with the fellow Forex traders on the Trading Systems and Strategies forum.