Strat's Long Term Stress Free Trading

Quoting One14

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It's amazing how much we can get out of one post and a couple of charts. Don't worry..I'm not saying that I can just jump in now. Practice practice practice.
This all looks crystal clear now that we are looking in the rear view (and have an experienced guy to walk us through it). When it was happening in real-time, how did/would you enter and manage the trade?
The March 30th hammer looks awesome, but following our rules of not making decisions until the bar closes, we didn't know it was a hammer until then. Or at least we couldn't act on it.
At...

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One step at a time along The Path of Learning and you will get there and know the answers for yourself.

This applies to everyone:

Don't ask for answers to tomorrow's questions until YOU can answer yesterday's questions.

USDJPY, as mentioned last night, approaching an important level. Monthly is still showing HH and HL although at present price is nearer the bottom of the bar.

Weekly has retraced to the 61% Fib of the big swing low to swing high(Dec-Mar) and is finding support off the 95.5 level.

Daily is (with 2 hours or so remaining) until NY close, shaping up to be a nice pin/hammer.

Risk would be 100 pips or so, representing 1.27% of my account. 1st TP/BE level would be at 98.



Similar (NOT IDENTICAL) set up on euro yen

After I got my 1995 notes out, I realised my loss on the Yen should have been my loss on the US$ - it's exactly the same trade though, except upside down since the Yen futures are the inverse of the US$ futures. I was tracking both at the same time and fortunately, very fortunately, only traded one side. There were times when I traded both sides and therefore got both wrong. Horrible, horrible times but a learning experience although very expensive.

My "Yen" story has been written for quite a while and I am waiting while "I" am in the right frame of mind to post it as it still brings back the "hurt and pain" it caused me and my loved ones.

""how you wound up where you are now?""

I thought I explained this on my first post. In other words, I learned everything I could find, I believed everything I was told, I bought everything that "guaranteed" success, I paid for private tuition with "so called $millionaire trading gurus, I searched for every "trading system" I could find, I traded everybody's system, I developed my own systems and indicators, I "met" as many professional traders, floor traders, brokers as I could find, etc., etc.

I honestly believed there was a secret "Holy Grail" in trading known only by a few people - it became my life's work to find this (I could have written "The Davinci Code" about trading, years before Dan Brown, with all that I had been through).

During all this, I blew over $200K through trading other people's beliefs, other people's systems and methods but mostly, not really understanding price and ignoring the devastating effects of trading psychology. I was convinced that, because of all my qualifications, I was "above" trading psychology and it didn't apply to me.

I got to the point where the more I searched, the further away the "Holy Grail" seemed to be. After paying $999 for a futures traders secrets course from a businessman turned "millionaire trader" who happened to live in Southern California, I realised I knew more about trading than the guy I had just paid $999 to!

Through all this, and with each failure, I became more and more determined to make this work. I became "obsessed" with making money from trading. I was successful in everything else I had done - only trading eluded me.

At the point when I found out I knew more about trading than the guy who I had paid $999 to, I decided it was time to stand back and take stock and look at where I had been and where I was now.

I recalled my experience with ONLY those that had "the most effect and impact" on me. Strangely, it was only a handful of people and did NOT include those $millionaire trading gurus who I paid $thousands to. It was Dr. Joe and the professional traders, floor traders and brokers.

I got all my notes out that I made from these people and looked for a common theme. I didn't really have to look because I had written it and it was staring me in the face - I just didn't READ it and worse still, I didn't devote the time and effort to UNDERSTAND it.

Each and everyone said something like "trading is simple", "don't complicate trading", "buy when it goes up", sell when it goes down", "cut your losers", "let your profits run", "price will tell you what to do", "price is the ONLY thing to watch", "price does not lie", "price only goes up, down or sideways - how complicated is that?", "price has a reason for doing what it does", "buy at support", "sell at resistance", 'watch price pivots", "forget indicators - price is the only indicator you need" etc., etc.

This was my "light bulb" moment - nay, "searchlight" moment! Reading again where Dr. Joe said he threw away all his technical analysis after his CME visit, and that trading was done by humans with "emotions", told me I had gone down the wrong path of indicators, systems and technical analysis.

The MORE I READ my notes, the MORE I understood. There was NO "Holy Grail" - these guys were their own "Holy Grail" - I was my own "Holy Grail" - the search was over - I had found the "Holy Grail" - ME!

In this "moment" of enlightenment, I pulled up a naked chart and visualised looking at it like "they" would - all I could see was "price" and that is all they ever talked about. The more I looked and stared, the more I realised I didn't know ANYTHING about price! Even after spending $six figures on trading education, I knew NOTHING about price!

From that moment on, I ONLY learned about PRICE which lead me to how price behaved at SUPPORT and RESISTANCE which lead me to candlestick charts.

The rest is history although I have to confess, the "technical" side of my brain still has me working and developing momentum, cycles and volume to augment PASR.

Nicole, there is much, much more to PA than the MAs - they are only there as our "guide". Focus more on the last bar in each time frame WITHIN the context of the bars around it plus trend, momentum, S&R etc.

How do you see 0.8650 as ""key areas for longer term trend reversal south"" ? Start at the right side of your chart at 0.8650 and work your way left - ask yourself if there is more support or more resistance

It's a personal choice - go back to the "Properties" tab and change the colours on everything until you see something you like

Be careful, Dan, we have strong DOWNWARD momentum and Momentum Cycles

Tomorrow is the US FOMC statement which is not likely to have the effect that last months statement did with the announcement of printing money and interest rates are already near zero but nevertheless the market will be listening closely to what the Fed has to say. If the Fed says its outlook is unchanged and it is happy with its efforts to stabilise the system it could be supportive of the US dollar. If it says that additional measures (more quantitative easing) are required it could be very negative for the USD.

Also watch out tomorrow for the Bank of New Zealand rate statement at the end of the day.

Crude traded in very choppy tight range today, like the indices, after yesterdays swine flu madness and looks to be forming an IB. Crude inventories are tomorrow at 10:30 NY time

Nicola

Excellent Nic - many thanks for the news warnings. Since I've switched out here to dailys I hardly ever check the news now! Is that bad?? Not sure but if you belive in the efficient market hypothesis then all known information is reflected in the charts!
May be a good day to sit out and let the day unfold!

Would you guys and gals take this...

When it's boss's boss says this...

No. Below BOSS 20, below daily 20 and 50, below trendline and just below SR.

I'm good at eliminating trades. Just wish I could find some to take.

Dan,
I was looking at the same hammer - trouble is that it's not sitting on any SR levels or fibs that I have on my charts; it's just hanging in free space, so no action for me. The more risk adverse may like to take the trade off the wkly 20ema, but that's not a good enough level for me especialy when flat. Also trapped under the same resistance as mentioned yesterday.

NB.
I always find MAs to be more realiable as SR when at around 45 degrees plus for support btw.
Just my take.

Tonight's The Night - sang the cockney Scotland supporter in 1976

But, will it be your night?

We have been sat on our hands patiently waiting for this moment to arrive, the moment when we see and recognise PA and when it finally arrives, there is PA all over the place.

Spoiled for choice - NO!

There are lots of Bonds out there, Bond girls in wrong places, Bond girls not in the right places, and Bond girl "wannabes" in and amongst the real thing.

Make sure you have S&R with your PA (one is no good without the other) AND make sure you are taking the trade in the direction of the BOSS and BIG BOSS.

But BEFORE any of that, evaluate RISK, determine if you can afford it, determine if you can accept the LOSS and then if still OK, make a PLAN, a PLAN that you can accept and stick by WITHOUT any interference, then place your trade and trade YOUR plan.

IF IN DOUBT, STAY OUT

EUR/USD

Market tested TL and respected it. No PA, NO TRADE

USD/CHF

Market opened above 20 ema and 50 sma but closed below it. IB testing
a TL. Next support is between 1.1250 and 1.1300. it can be a trade for
100 pips but the risk is too high. We have better trades around the
corner. NO TRADE

USD/JPY

Overall is downtrend. PB testing 38% Fib level from the up moviment that
started on 1/21. First resistence is around 97.5. I'd like to
see the market testing the 94.50 where there's a confluence between
support and 50% fib level. No trade

GBP/USD

IB looking like PB within another PB having resistence on 1.47 right above.
NO TRADE

USD/CAD

PB on 1.22 but there's a UP TL on 1.21. No Trade

EUR/JPY

PB testing support at 1.2550 and 50% fib level. 20 and 50 MA above but
location is good in my point of view.

Amen to that!!

Hi Bloom and Grim,

I don't use MA's too much so can't comment but looking at my chart, this level has been a pivot point since October last year.

I won't take it for a couple of different reasons - the nose isn't long enough, the open and close aren't contained within the real body of the previous bar, the close isn't higher than the open...but mainly because of that juicy looking shooting star on the monthly



Roll on May...

Thank You.

I don't know about anyone else, but I get a ton out of posts like these. Same with stories. Thanks for the educational material posted last night. Read through it and it is priceless.

Nice Dan - If I could see it!!! Ref the monthly - we do have 2 days to go - a lot could change in 2 days, so I would'nt base any decisions on an unformed bar - been there done it and lost the proverbial t-shirt from me back!!
But mainly I think that once the equities start to drop again then it will be back to the yen for everyone!!

Have you tried lovely yellow on black for your bars - we could see the PA then!!! ;-)

Sorry Grim - looks bright on my 22s then i upload and...well...

No i won't play any monthly bar but if it closes as a shooting star, it gives us direction for lower TF entries in May, and with that PA in mind, my bias would be short.

Bloom and everyone else who is eliminating "bad" trades.

Instead of moaning and groaning and crying in your beer, you should be patting yourself on the back and buying yourself a beer!

It might seem that you are not trading but you are - anybody can make a trade and usually, "anybody" loses that trade. It takes discipline and patience to "sit out" trades when all around you are flashing their tickets.

Eliminating "bad" trades and not trading bad trades is what actually GROWS your account and separates the "wannabees" from the "willbees".

You are improving your trading skills and trading psychology and should be very proud of that.