A Surf Rider's Journal

Welcome to my Journal. This is my start to document my trading style, thoughts & ideas plus the most important part, my emotions.

To introduce myself, I'm not a newbie nor a pro. I have a near of two years of trading experience in Forex. I'm also a member of Jacko's private group. I have blown an account to 40% so I have had my hard times as a trader. As time has past, I have learned a lot from both market and other traders. Sometimes when I look at past I laugh to what I did before!!

Now, I'm planing to document my experience to help me & others grow. I would be glad for others to join.

Enjoy your stay,
Best Regards,
Khanderoo

1. Trading Pair: Only E/$.

1. Trading Tools: Trend lines (H4, Daily & Weekly T.F.), Fibonacci retracements & extensions (Daily and Weekly T.F.), AMM-S risk management technique, Beautiful round numbers (e.g. 1.6000), Emotion Controlling techniques

1. Time Frame: H4, Daily, Weekly

1. How to determine the trend: It should be a clear and visual “Higher highs, Higher lows” OR “Lower highs, Lower lows”.

1. When to enter:

1. At the trend lines touch. The exceptions: After significant news release with counter trend direction & at holidays (Christmas time, holidays at US/Europe…)
2. At Fibonacci retracements first touch for quick profits (20~50 pips).

1. When to exit: Every successful exit consists of two steps;

1. Securing the position using AMM-S.
2. Taking profit at beautiful round numbers/Getting out at broken trend line/Hitting a 100 pip TSL.

An unsuccessful exit is to hit S/L directly.

1. Trend lines: Is a leading indicator of market feelings. It is created as the market moves. The higher the time frame the more power it has. It needs a lot of energy & money to break a weekly trend line. The power of trend lines could be realized by market movement observation BUT you should always consider that nothing is 100%. There is a fact that market doesn’t like S/R levels and it will test it and escape from it SO when you see market is hanging around an S/R level you should warn your self that the probability of it being broken is increasing.

1. Fibonacci retracements & extensions: Market movements are a reflection of trader’s position in the market as total. A high percentage of BIG & Real traders use high time frame Fibonacci retracements for entering positions and its extensions to take profit. Thus we could also bark with the BIG DOGS!!

1. AMM-S Risk Management technique: This is a technique I have learnt from Mr. Hani in his very valuable thread called “Anti Big Dog Trades”. You could refer there for a complete description. In short, it closes a percentage of position in profit to secure the rest of it while it will gives you the chance to enter new trades for free!! A must read. AMM-S is used where S/R area levels have more probability to hold for a longer time with multiple retest and a 20 pips penetration area. Its goal is to build slowly incremental opened positions while securing them to have good positions targeting hundred of pips.

1. Beautiful Round Numbers: As the legend Jacko says, The pros have gotta be saying that the big game in the industry is to now grind and push the market to 1.6000. After that they don't care, they have had their fun...and that’s why a market will whip and drop/rise dramatically straight after the target has been hit

1. Emotion controlling techniques: This is the main reason I wanted to start this thread. I have found that to control my emotions, I should write them down, then I should find a way to control them and finally repeat to myself when I meet that emotion again. These steps will help me control my emotions in the long run & writing them down in a public forum will help others how to deal with them OR maybe they will give me better solutions as Mr. Hani says: “Learn, Share & Grow”.

My Thoughts for the week:

Fundamentals:

1. We have seen the first Daily trend line Supporter to be failed by a two years low "German Ifo Business Climate Index". This is clearly signaling that the German exporters are having a hard time with expensive euro. Some Pro's are saying that this wave down is clearly by ECB looking for a more "Exporter-Friendly" euro exchange rate.
2. BUT, on the other hand, we still have a very weak USD & this will NOT change until the governors change the way they act... This could be possible by the new president in US.
3. For the weakness of USD the inflation pressure (food & energy prices) is so high cutting interest rates should be done with high cautions & urgent needs SO ECB can't cut rates & FED is also feeling that its enough.

Technicals:

1. The E/$ Long-term up trend isn't over at all. There could be a possible correction like what it was in 2005 BUT that also needs a lot of fundamentals news to support it & a lot of energy to control it. This is clearly shown in the monthly view of E/$ attached.
2. In the way down for E/$, there is a daily trend line left plus the third trend line meeting the beautiful round number @ 1.5000 SO that should be solid support if met.

My Plans:

1. According to my rules I will enter at a bounce at the second trend line with the little ellipse showing it @ 1.5550. NOTE: As of today it is already broken.
2. If that didn't hold I will be using short-term profits from Fibonacci levels bouncing also shown attached.
3. I will look to enter again at the third trend line near .382 long-term Fibonacci @ 1.5000 shown with the bigger ellipse.
4. As always I would use AMM-S at trend lines & only profit taking at Fibonacci's.

Any thoughts are appreciated,
Regards,

I just came across a beautiful article from some one called "DC Bonta". It is very good to let everybody know about it:



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Dear ...,
Remember that old story of the Emperor and his “New Clothes”? ...There he was, the great monarch – the mighty ruler of the land, strutting around like a peacock because of his marvelous, magical new clothes that no one else had (including himself). The guy was completely buck-naked… and everyone knew it.
I think even he must have known it, but his pride and arrogance kept him from seeing what was so obvious to everyone else.
Folks in the Forex world get like that Emperor sometimes. They take time, money and energy to study up on the best and brightest strategies. They usually start with the basic fundamentals that are essential to profitable trading and high returns. Some even put the basic stuff into practice and win.
But then, along comes a slick talkin’ “guru” (and I use that term lightly here… I should say slick talkin’ salesman) with a whole bag of fancy new tricks… and the old standard fundamentals get thrown out the window.
The result? A whole lot of really “clever” FX traders running around in their cool “new” strategies… but everyone can see that they forgot to put on their fundamentals that day.
Yup, sad to say, but 95% of all the folks trading Forex out there are financially naked and losing money fast.

It’s Time to Put On Some Real Clothes

So, I call this secret, the non-secret, because it is really just a basic fundamental of trading. You’ve heard it just about as many times as you’ve slipped into a pair of pants in the morning. It’s old hat and old school.
But it works.
The non-secret covers your backside and protects your assets. It creates profits and solid returns time after time. It helps you get a solid base of consistent, regular, predictable, profitable trades, day in and day out. It’s like putting on a well-worn pair of jeans… sure they’re old, but they’re comfortable and they cover you up.
Here’s the kicker… I’m willing to bet that 9 out of 10 traders out there don’t use this basic fundamental “secret” when they are laying out their strategies and setting up their trades. Maybe they don’t understand it, and that is why they don’t use it. I don’t know… I just know they don’t use it.
But they should, because the stuff they’re flashing instead is kinda embarrassing.
Ok, enough of that! Here’s the non-secret secret…

Trade With The Trends.

I know… lame, boring, old school. But again, it’s made me a bundle of dough.
Trading with the trends is an essential fundamental that you need to understand. I’m going to assume that you are one of the more clever traders out there and not insult you with a long, drawn out explanation of the principle. You probably have heard it all before.
What I will do is just make it a bit more specific to Forex trading so you get the full picture of how to apply it here.
You need to find the current trend on a longer time frame like the daily chart – or even longer. Sometimes, you have to go back several months to get smooth data.
For example, price may appear to be in an uptrend for a specific month – but is the pair in a current uptrend or is that a retracement of a downtrend already in progress? The only way to know for sure is to go back a few months and take a look.
In ..., I explained that if it’s in a downtrend, then draw Fibonacci levels from the high to the current low and see where the market may retrace. Has it already retraced to those key levels?
Also, you can draw the monthly pivot points on the daily chart to see where support and resistance is. Do these levels overlap with any key Fibonacci levels?
Now, do the same on your shorter time frame charts like the 60 minute, 30 minute, 15 minute, 5 minute or whatever you use for intra-day trading. Once you clearly see the trend, you can play the bounces at these key support and resistance levels in the direction of the overall trend.
So, if it’s in a downtrend, FORGET about looking at any long positions. Simply look for levels where price is going to hit resistance and short at those levels.

A New Closet Full Of Real Clothes… and Huge Profits

Here’s a promise: If you nail down this basic fundamental of the Forex market… and consistently use it…your trading will improve dramatically!
Remember, the fancy “new” ideas, strategies and concepts are not necessarily bad – some of them should have their place in your arsenal. But they should never, ever blind you to the importance of consistently using the fundamentals.


Here’s To Your FX Trading Success,
DC Bonta



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I am really amazed about what have been said above. I would suggest we only think about it. Think & Think more, we will get a lot of clues...



Regards,

Hi Khanderoo

Just came across your journal. Good luck with it ! I will be following your journey closely.

Happy trading !

Bakuli

Hi Bakuli,
Nice to have you in the thread. Please feel free to describe your opinions about it. And also kindly accept my apologize for being late in my reply. In the last four days I have been reading "Trader888" posts. You could find it here (Just look for his posts & "SeekingLight" responses.). It was very interesting. I have made his thoughts documented attached. I have been thinking about it a lot. I think this is a must read for any trader.

I would be glad to have your ideas about it too.

Best Regards,

Tools Added:
I have decided to add EMA(50-Close) only at H4 time frame as a Buy/Sell Zone identifier.

Market Update:
There are some good supporting news coming out of US BUT as could be seen in H4 Time frame it got rejected by traders. Why? I think because they are trying to focus on interest rates in euro zone. But bears have been strong enough to protect 1.5600 SO it is all about Mr. Trichet to show the path. BUT we should also note that the main BEAR players from the top are FED & ECB SO be careful. As long as it doesn't get confirmed we shouldn't take long positions. Aggressive traders could take short ones (only @ resistances BUT with smaller T/P's) because clearly we are in SELL Zone.

Take Care,

Going Long; After the bearish trend line is broken (confirmed from candle closing above it) & higher than EMA (In our buying zone). After opening the position, I will be watching for a false break out too SO that I could close it on break even or near to it.

Going Short; After some down move and on its bounce from the bearish trend line, lower than the EMA. I will also be looking here for NOT to be CUT by a sticky trend line (trend line getting broken) SO that I could close it on break even or near to it.

I do not like going short on weekly pivot bounce because it is too near the 38.2% support + the trend line will have a sticky look!

Attached you could find what I mean on past experiences.

Best Luck to all,