Monarch's Journal of 2008 Trades

the funny thing is, i asked the same question after your one post and it said the same thing!

it has to be true. the internet 8 ball can't lie! wouldn't the FCC do something about that?!?!?!

Not only is it a MA and sup/res breakout, but it is a trend follower, even though it is short trend, it is still the safest way to trade.

I am going to eliminate one of the indicators since it is showing false signals, but the other is pretty close to what I want.

There is a few elements that indicators and MA's do not do, and that comes with screen time and watching a pair for months on end, also getting use to the candles and types of reversal/rejections that take place in pullbacks.

I was interested in going to a 15 minute, but the 5 minute has been good to me, and I know I can make pips just on a candle alone, this other stuff is filler, but not to replace what is happening over all.

I am going to erase the chart, and go out to water my orchard, then head to bed.

I will be on tomorrow night sometime.

Cheers,

Ken

If you get a chance tomorrow look across the 5 minute and start to track certain moves and candle formations, along with the MA and supp/res areas.

We can get together on these issues and start to pinpoint a few things together.

chat with you tomorrow.

Ken

Ken,

thanks for all the great chart analysis, I had a nice day friday trading the 5 minutes tf . Always learning is a very good thing.

Later,

Alex

Good to hear that you did good on a Friday Amlo.

I usually finish my trades on Thursday and don't open charts on Friday, but after looking back the big drop was a nice setup on shorts.

What strategy do you apply on the 5min?

Do you trade other pairs?

Give us a pic if you can, I like seeing others charts.

I give much thought to the Forex, even during the hours I am not in front of the screen I am thinking over all the scenarios that come our way.

After many strategies and analysis over the years I have come to the conclusion that I don't want to trade long term (Hour or More).

I also have realized that we can make several easy trades with quick in and out to profit us around 10 pips per trade.

My spread is usually 2 pips on EJ and my commision is another 1-1.5 pips, so overall I have to clear around 3 pips or slightly over that to make money.

So if I target 10 on average, sometimes less and sometimes more, I actually make around 7 pips per trade.

It is very easy in a two hour period to make 2 successful trades with this target, so what I have done is added the lot size to the trade to make the impact on my account.

I do make many trades in between, and those are outside my strategy, therefore I make sure I put less amounts of lot sizes on these in case they turn bad, but usually I will even be very hesitant on those type of trades.

I could easily avoid taking trades and wait for 1 setup during my trading session, and even if I get only a couple per week, which would be just fine, I could clear 14-21 pips total in three trades.

If you took an average of 18 pips (all profit) in a 4 day trading period (mon-thurs) you could be making very nice profits overall.

If you traded a mini account and only put 25 mini lots on at 18 pips, that would be 450.00 a week.

I would think that 50 mini lots would be reasonable for someone with 10K or so in an account, that would be 18X50= 900.00 a week.

So you can see that it does not take lots of trades to make money, but good trades that meet all the criteria of a strategy proven over and over.

Now let's say you trade a real (standard) account and you put 50 lots on, well now your talking "money" 18pips X 500.00(50 standard lots)= 9,000.00 per week.

It is that simple, so when I get 20 pips in one trade, and having 50 lots on it, I can sit back and let all the little stuff go by, and just take the cream off the cake.

Compounded lot sizes on successful entry and exits.

This is the reason I only look for small targets when I enter, because 10 pips can be had anytime of the day.

Cheers, and let's make some pips this week.

Ken

Ken,

I usually trade u/y, g/y and e/j. I have some ma's on my chart and use support and resistance areas. I was looking at your chart what's your setup and indicators that you use?

Here is a pic of my chart:

Ken,

I absolutely agree with you, the more I think about the more I just want in and out quick. I have been a lot more profitable in the past year just taking 5 to 15 pips per trade. No long term for me. I want to be able to leave my office and not worry about a trade.

Later,

Alex

I have not disclosed my indicator or it's setting for now, still in the process of review.

I do have several MA's which I use, but mainly I just watch the few key points of reference.

I am working a 15 cross reference chart now to add confirmation to the already 5 minute strategy, but have much time to look back at to verify it.

I use to trade long term for weeks on end, but got real tired of always watching and worrying.

Looks like your using a few indicators yourself, which is good for anytrader who learns what to look for within them.

I am basically using an indicator to help others on the team to learn price trend (short term), but eventually I would expect the trader to start to sense the direction of the flow by the rythym it takes in the segments of movement.

Watching one pair over and over gives an individual a clear view of what has happened prior to a trade, and help to prepare one for the upcoming attack during the retreat.

Attack - Retreat - Attack

Attack
Market movers initiate the attack when price presses forward and breaks the barriers of supp/res lines.

They move into enemy lines and captures the enemies possessions, then once they capture, they return to safe a safe haven (consolidation) to store their prize of battle.

It is here that we see the retreat stage (pull back of market), which does not mean defeat per say, but a place of refuge from the recent battle, it is here the aggressor finds a place to store the goods of the recent raid, and rest before the next stage of battle.

Once there has been a place for the marching lines to rest and restore there strength, a call is made and the attacker makes another move into the enemies lines to assure they have redeemed all that is available.

This time when they enter the enemies line they find a stronger resistance, and they stop the attack at the lines and cannot press through the line of defense, so the attacker finds a greater Resistance and decides to make a dash for safety on the second retreat from attack.

Attack
to set upon or work against forcefully, to assail with unfriendly or bitter words <a speech attacking her political enemies>, to begin to affect or to act on injuriously <plants attacked by aphids>, to set to work on <attack a problem>,to threaten (a piece in chess) with immediate capture

Retreat
1 a (1): an act or process of withdrawing especially from what is difficult, dangerous, or disagreeable (2): the process of receding from a position or state attained <the retreat of a glacier> b (1): the usually forced withdrawal of troops from an enemy or from an advanced position (2): a signal for retreating c (1): a signal given by bugle at the beginning of a military flag-lowering ceremony (2): a military flag-lowering ceremony2: a place of privacy or safety.

I agree with you all the way Monarch.

As said in your post 10-20 pips a day is cake if you are smart and PATIENT!

Many noobs get into this market and see that you can easily double your account in a day if you catch the right move at the right time with the right amount of money out!

I won't BS around and say that you can't do that, what I will say however, is that you cant do that consistently over a long period of time. If it was that easy everyone would do it.

20+ pips a day is beyond reasonable like Monarch said.

If you increase the amount you put out and get in more when it runs against you, eventually you will win.

Here is the problem with just increasing as you lose.

(Don't worry Monarch I agree with doing that strategy and trade it myself.)

But back to the problem. For someone that has never traded that way it can become very scary when 1/4 of your account is out on the table. They begin to panic and pull out early and then justify the pull out by saying, "That doesn't work!" or "I'm glad I cut my losses there before it gets worse!"


The panic sets in for many reasons but I will outline some real quick.

1) They have not studied the charts and pair they are trading enough.
2) They are too emotionally tied to there money.
3) See #1

Those are just a few reasons I can think of real quick. It's late and I'm tired.

#1:
When I started trading 2 1/2 years ago I had absolutely no idea what I was doing. I heard of this great strategy and started trading it. It worked great for the beginning. My account was growing and I was off! Well, so I thought! I didn't study the charts at all. Just traded when I was suppose to and that's how this whole thing worked.

One day a trade went against me and I panicked. Instead of being patient and adding as I went I just got out. Yeah lucky me I told myself. I cut my losses and will get them back tomorrow. Well needless to say the market came right back where I got in and continued in my direction.

I was so angry over the whole thing that I started to question my every trade. Bad bad bad thing. Watch the charts, trust your trade and take it! If you lose you lose. Life goes on!

So before I ramble forever let me say this, trust yourself and your strategy. Well trust a strategy that is proven to work for you and trade it. Don't panic over a trade going against you.

There is always money to be made in this great market. Remember 95% of traders lose so that leaves a lot for us 5% that win!

A farmer can't plow a straight line looking back.

Get in get out. Take your pips and laugh all the way to the bank!

Well just my 2 pips for the day. Hope this helps someone out there who reads it. It sure would have helped me when I started.

Good night and see you all tomorrow,

Big Pippin'

Cuz pippin' ain't easy, wait yes it is!

Here is a sample chart of Attack and Retreat stages.

This hourly chart reveals the attack is made and supp lines are breached as the bears achieve the victory, then price retraces back into the retreat area which I call the pullback zone.

This is where I place my MA’s to catch the area of more predictability.

I trade both the supp/res.. breaks and the retreat areas on the next attack to the second test of a recent supp/res. that was set in the attack.

This is the reason I exit early, because it is normal for a second attack to fall short of the enemy lines and return to the safe (retreat) zone.

The reason I like to enter the retreat (pullback area) is because of the predictability of movement, the defense is backed against the wall and the attacker wants to advance, so catch the second advancement towards the next break out of supp/res.

There are many examples of this type of attack and retreat in every time frame, I could do it on a 1 min or even a 1 second, I just prefer doing the 5 minute because it is all the same to my eyes when it happens.

One of the dangers of trading against a trend mover such as the attack move, is the chances of it breaking into the next segment of 70 pips, that could drawdown your account badly, so the best thing to do is join the force with the most strength at the moment, and with my 5 minute setup, it almost always give the direction the trend makers are going.

Take it to the next level, and initiate the attack, well, maybe some day we can move money that would move markets. LOL

This is a 5 minute chart from April 1st, 2008

There are lots of notes placed on this chart to show the areas of importance.

There was a good Short when price breached the supp. line, I personally want to see a breakout of a supp/res with a +70 pip move from the originating start of move which was failure at Resistance that rejected the bulls from advancing upwards.

I prefer a good consolidation period which I am calling the "retreat zone" to play out before I plan on taking a trade.

One of the reasons I wait for a breakout and a larger move then what was seen in the 15 pip march against supp and res on the chart, I like to see that the Bull or Bear is in full attack, and usually when there is as many straight candles as this chart shows the Bears were in full attack of the enemies line and possessions.

There were 12 straight red/bear candles before the pull back even revealed itself, it is this point where I watch for a move back towards the 18lwma and 21ema or near a 30 pip retreat, then when I see this form, I join in on the surge attack to join in with the bears for my profits.

I also watch for the retreat back to the previous enemies support line in this chart which came up to the 50 ema and the boundry support line, I take a short there in expectation of rejection back into the retreat zone.

Remember, get in and out for small profits because there is always the possibility of the enemy returning attack and taking the price against you in a hurry.

Such was the case in this chart, Bears attack and take victory, they retreat and rest in the "retreat zone," then all of a sudden the Bulls want to get back their losses, and they push upwards to the check mark and the resistance once again.

This time there is a pull back into the zone for a bit and a big attack is seen breaking above the boundry and going upwards fast and hard to regain the bears previous victory.

On the Bulls attack, there was no turning back and they defeated the bears badly on that battle.

I would have taken many trades also on the bulls attack which was as successful as the posted diagram of the bears attack.

Once a trader can understand the market mentality, all they have to do is pick sides, and make sure your on the side that is winning.

Never get greedy, get your pips and get out, or you may end up being the defeated and losing all your possessions.

Cheers to all traders.

Ken

This is the same move, this is my typical chart I use on a trade.

Watching for big move.

Needs to be a pretty good +70 pip move and not too choppy.

Price seperates from the MA's and Indicator shows signal.

I wait for pull back around 30 pips and watch for 1st area of 18 lwma or 2nd area at 21 ema.

I usually will not enter at the 18 lwma if price has not pulled back far enough.

I would love to have one of these trades once per day, that is all I would need.

I am going to start a skype trading room chat during the Asian Sessions Monday thru Thursday 8pm EST with some Sundays when available.

You can pm me to join my Skype EJ 5 Minute Trade Chat Room.

Cheers.

Ken

hi.. Ken,
another question :
1. in ur ex EJ. u place fibo at h/l daily. n open long at 38.6%, can we put pending order at 38.6% without seeing short tf ?. n how we connect fibo with MA ?
2. I read about TP aday about +10 pips with 5tf in ur strategy. some people said to many whipsaw n false signal in short tf , little confuse 4 noob like me.
tq.
bud

Great idea... as those planning to learn can see the chart and the analyst as it is unfolded.

Been busy all day and have not had time to add anyone to the Skype chat, I will not be trading until ASIA session MONDAY.

I will be around Monday afternoon to get set up on chat room.

Cheers, and enjoy the night, see you all tomorrow.

Ken

One could say there are whipsaws in the market from 1min up to hourly, but that is not what I have in mind when making trades.

I will be chatting in Skype the next 30 days to get you on the same page in what to look at.

Don't just think FIBO, that is not even a part of what I am looking at, it just works along with my setups.

Many questions we all have, just takes time to answer them.

Stick around a few weeks and it will start to make sense.

Cheers.