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  • #2,741
  • May 8, 2009 12:35pm May 8, 2009 12:35pm
Quoting strat
Dan,

Thanks ever so much for taking the time to post this as this is the "proof of the pudding" that what we are doing on here really does work PROVIDING you READ, UNDERSTAND, LISTEN and are able to take a bollocking when you stray off The Path!

Just for everyone's benefit on here, I want to share a few more things that Dan brought up.

Dan right now, is our "STAR" student and is the inspiration for you all to follow. Don't think it came easy for him because it didn't and he had to go through what you lot are probably going through now - transition...
dark side of the moon......very zen.
  • #2,742
  • May 8, 2009 12:40pm May 8, 2009 12:40pm
Quoting strat
12 pages per day - does this mean you are READING & UNDERSTANDING?
Most certainly. A few of the most important things I've learnt so far:

a) Patience. Wait for the price action in the right place. Don't try to make a trade where there isn't one. The best trades don't come along often, but when they do, they're worth waiting for. Confluence is best, s/r with fibs, MAs, etc.

b) Calculate the potential loss first, not profit. If you need a 100 pip stop loss to potentially gain <= 100 pips, not good. Don't trade it or trade smaller lots. Obviously depends on how risk averse you are.

c) Use the weekly to understand market direction. Use daily to look for entries in that direction. Again, waiting for price action around areas of s/r, preferably with confluence. If you look for entry on a lower time frame, always place stop loss based on daily.

Another great thing I've learnt is about market makers, and how they drive price to take out stops so the market can move. A shooting star tale above recent swing highs for example, will likely take out some stops and result in a good move south.

Probably a lot more to come, but I'm taking my time.
  • #2,743
  • May 8, 2009 12:46pm May 8, 2009 12:46pm
Quoting strat
I'm not really the best guy to answer on demo and demo account size because demo does NOT work for me. I can be the world's best trader and outperform anybody with a 95%+ success rate on demo BUT the moment I trade with REAL money and put my emotions in the equation, I drop down to ultra conservative trading. My fear of losing cancels out my risk averse approach.

For me and my trading psyche, demo serves no purpose because it doesn't bring my emotions into play. As an example, I have been running REAL money on my experimental momentum, cycles and...
You must respect your work.....this is the most important thing.Dont disrespect your work in the demo stage by playing with volume.

Demo is our only means to test ourselves in the heat of battle so make it as close as you think you can muster or go to a third party to get.If you get good and CONSISTANT the loot will come or you will be bold enough to get it......trust me...g
  • #2,744
  • May 8, 2009 12:47pm May 8, 2009 12:47pm
Quoting pmn100
Most certainly. A few of the most important things I've learnt so far:

a) Patience. Wait for the price action in the right place. Don't try to make a trade where there isn't one. The best trades don't come along often, but when they do, they're worth waiting for. Confluence is best, s/r with fibs, MAs, etc.

b) Calculate the potential loss first, not profit. If you need a 100 pip stop loss to potentially gain <= 100 pips, not good. Don't trade it or trade smaller lots. Obviously depends on how risk averse you are.

c) Use the weekly to understand...
nice....keep going...its nice
  • #2,745
  • May 8, 2009 12:52pm May 8, 2009 12:52pm
Its not that 2 trades are enough....man id love 1 a day.....but its not like that right now.

Thats all she has given.....but its enough im up.Even if i did a big fat 0% up but no losses im good....
  • #2,746
  • Edited 1:22pm May 8, 2009 1:08pm | Edited 1:22pm
OK, Stuart, you asked for examples of failed trades. How about an example of a trade that worked where Strat failed?

With regard to my cycles, momentum and momentum cycles work, I am now at the point where back testing shows them to be really sound and profitable. I now need to prove to myself that it works in real time with real money so I waited for the first opportunity to put my REAL money on the line (demo doesn't work for me)

This opportunity came at the doji (my data) on USDCAD on April 21. I entered my order at the close of the candle to go short based on my momentum cycles. The next day produced a doji IB so I CLOSED the trade out on the close of the candle. Had I held the trade, I would have made A LOT OF PIPS, and the damn thing is still going!

So, why did I close a fantastic trade?

You have to remember this was purely experimental. There was no PA on the daily or weekly to support it. I asked Baba G about trading it, he didn't like it either. Being experimental, I didn't have a PLAN.

Since I was basing this on my Momentum Cycles, I was expecting the next bar to be a hard close down, and it wasn't. I then started thinking this doji IB could be a "pause" before taking off higher again. I started thinking this was going to be a "big" losing trade. I started thinking my Momentum Cycles are useless etc. The bottom line is my emotions (trading psychology) controlled my beliefs and actions. I let FEAR control me.

Had I just stepped back and put my "technical analysis" hat back on, I would have seen:

My cycles were still saying DOWN
My momentum was still DOWN
My Momentum Cycles were not only STILL DOWN, but accelerating DOWN.

So, you can see that, as experienced as I am, when I step into the unknown, I am no better than you guys along The Path of Learning!

My lessons learned from this are that I must follow my next Momentum Cycle through to the end and disregard all other PASR. I must devise a PLAN to get my emotions out of the way during this experimental testing.

The bottom line is that it shows just how POWERFUL having a PLAN is (even for experimental work).

After telling Baba G what happened a couple of days ago he said "Worse than losing eh?"
My reply: "There's nothing worse than losing you dumb shit!"
His reply: "LOL"
I think HE was testing ME (How dare he?)
Attached Image (click to enlarge)
Click to Enlarge Name: usdcad momentum cycle trade.gif Size: 21 KB
15 YEARS OF PASR ON FOREX FACTORY!
  • #2,747
  • May 8, 2009 1:10pm May 8, 2009 1:10pm
Quoting Baba G
nice....keep going...its nice
Thanks G

It was the post you made somewhere between pages 1 and 50 where you mentioned about taking just 2 trades a month that I was thinking about when I typed out paragraph a) above. Obviously account size comes into play here, and its not possible for all, but eventually. As you say, you can only take what the market gives.
  • #2,748
  • May 8, 2009 1:17pm May 8, 2009 1:17pm
Quoting pmn100
Most certainly. A few of the most important things I've learnt so far:

a) Patience. Wait for the price action in the right place. Don't try to make a trade where there isn't one. The best trades don't come along often, but when they do, they're worth waiting for. Confluence is best, s/r with fibs, MAs, etc.

b) Calculate the potential loss first, not profit. If you need a 100 pip stop loss to potentially gain <= 100 pips, not good. Don't trade it or trade smaller lots. Obviously depends on how risk averse you are.

c) Use the weekly to understand...
Very encouraging, good lad! Let's see how you do in the BIG TEST when you have your EMOTIONS exposed for all to see!
15 YEARS OF PASR ON FOREX FACTORY!
  • #2,749
  • May 8, 2009 1:20pm May 8, 2009 1:20pm
Now, please go to post #2567, open your current daily chart and based on EURAUD post, try to develop a similar complete trading plan. And we'll all appreciate if anyone share that plan with us.[/quote]

Hi Blackeagle
Unfortunately on my platform (ODL) I can't get EURCAD, nor even GBPCAD for that matter.
Will perhaps look into changing my feed.
  • #2,750
  • May 8, 2009 1:23pm May 8, 2009 1:23pm
Quoting pmn100
Thanks G

It was the post you made somewhere between pages 1 and 50 where you mentioned about taking just 2 trades a month that I was thinking about when I typed out paragraph a) above. Obviously account size comes into play here, and its not possible for all, but eventually. As you say, you can only take what the market gives.
You mean you actually UNDERSTOOD what he wrote? That's a first! Maybe you can translate in the future for us?
15 YEARS OF PASR ON FOREX FACTORY!
  • #2,751
  • May 8, 2009 1:41pm May 8, 2009 1:41pm
Quoting strat
You mean you actually UNDERSTOOD what he wrote? That's a first! Maybe you can translate in the future for us?
LOL. Baba G's posts always get a second read.
  • #2,752
  • May 8, 2009 1:46pm May 8, 2009 1:46pm
Quoting strat
After telling Baba G what happened a couple of days ago he said "Worse than losing eh?"
My reply: "There's nothing worse than losing you dumb shit!"
His reply: "LOL"
I think HE was testing ME (How dare he?)
I just spilled my coffee laughing ...
  • #2,753
  • May 8, 2009 3:10pm May 8, 2009 3:10pm
Quoting strat
Had I held the trade, I would have made A LOT OF PIPS, and the damn thing is still going!

So, why did I close a fantastic trade?

You have to remember this was purely experimental. There was no PA on the daily or weekly to support it. I asked Baba G about trading it, he didn't like it either. Being experimental, I didn't have a PLAN.
TO play Dad for a while:

You seem to have got out for pretty much a scratch so could've been a lot worse

You were uncertain of the trade as you weren't 100% sure of you're method

If in doubt, get out (especially if it's about to go into a loss)

Cheap lesson?

As has been said we never stop learning. Sometimes from our own discoveries sometimes from others.

Ramble finished.
  • #2,754
  • May 9, 2009 1:38am May 9, 2009 1:38am
Quoting strat
Don't get so wrapped up in S&R lines being "set in stone" and that price MUST bounce at such and such a level. Keep an open mind.

There are also some important levels below those you mentioned. What is to stop it going down to those? After all, it is making LLs and LHs.

It seems you have got so wrapped up in S&R that you are ignoring or forgetting the other tools in our toolbox. Is there an MA that we should maybe look at?

Why does your BOSS candle look good? What PA is it telling you? It's bloody awful on my data!
There may be similarities but each trade setup is a different case, therefore please do not take my EURAUD post as a template for other trade setups, instead you can use above Strat's comments as template re. what you should look for a possible setup, I agree with him 100%. And don't forget that more confluences from the tools we use, more probability that the trade would go in our favour.
  • #2,755
  • May 9, 2009 1:58am May 9, 2009 1:58am
[quote=strat;2721325]
Quoting Stuart14
Hi Strat.

[color=blue][color=blue]It is obvious to me that you are a salaried person enjoying the same income month after month. When you work for yourself, that "security" of a regular income goes out of the window. You now live off YOUR input and hard work. This brings freedom but also uncertainty. You have to accept that trading for a living will never provide a "regular" income, some months will be nothing, while others will bring more than you ever dreamed of. You will be living by the sword and dying by the sword...
Strat, sorry, but your assumption is totally wrong. 80% of my monthly income is based on commission, and has been for the past 10 years. It is because of this that I know exactly what living by the sword is really like. I have no security although actually have always made a lot more each month than my costs have been so have saved away a lot of money and haven't had to endure famine yet. It is this saved money that I want to do something with. Some is invested, some saved, some used for trading.

As far as I can see my point still stands. If you, as a person, have dependants, costs etc which cannot be cut down then you will always have a pressure to deliver (this stands in any business). I could put aside money for 2 years to pay for living costs etc, however if my trading in 2 years time does not yield a profit that covers my costs, I am simply delaying the inevitable.

These boards will always lead people to make assumptions based on their own experiences. For instance, I have no idea how old most people are on here, whether they have wives to support them, or who need supporting, whether they have children to support, whether they are living in 6 bedroom mansions or 1 bed apartments. Everyone is totally different, and as such they all have different expectations in their trading. I think new guys to trading need to be especially aware of this.

For all I know, you could be retired, with no debts, a nice monthly pension and capital saved up that you trade with (this is an assumption). Stress-free trading would come very easy if you were in this position, what is there to get stressed about!!!
  • #2,756
  • May 9, 2009 2:08am May 9, 2009 2:08am
Quoting strat
OK, Stuart, you asked for examples of failed trades. How about an example of a trade that worked where Strat failed?

With regard to my cycles, momentum and momentum cycles work, I am now at the point where back testing shows them to be really sound and profitable. I now need to prove to myself that it works in real time with real money so I waited for the first opportunity to put my REAL money on the line (demo doesn't work for me)

This opportunity came at the doji (my data) on USDCAD on April 21. I entered my order at the close of the candle...
Great post. I personally get more from this than from 90% of the other posts on here. Thank You. Totally honest and I can complete relate to the emotions in play through the process.

Cracking reply to BabaG too!
  • #2,757
  • Edited 6:59am May 9, 2009 5:34am | Edited 6:59am
whats wrong with the other 90%?

do you mean my posts? or Astondan or what?

we all wanna share here....no ego,just loot.

its not a compitition.There is no I in TEAM so if there is something you dont get just say so.

My last loss was in NOV 08.2.2% down...a full royal wipe out.(quantitive easing announced by Euro central wank) i was selling eur/usd....nasty...and i was in "trending market" management......which is 4 hr veto.....so i died a big death.After that i moved to "take no prisoners" management(consolidation) and all is well in the land......


The "stress free" part of the story has nothing to do with how poor i am.I have been doing the same boring old shizzer for years..........4 in all.

I started with less than 5 pence a pip when i went small live.As my account grew so did my lot size......then a family friend gave me his lolly and so and so and so.Thats the stress free bit.....now not then......Now i swing alot lot lot more than 5 p a pip BUT its the same boring old shizzer.

5p £5 £500 £5000 £500000..........watever.....same sh*t different day but all stress free..........g
  • #2,758
  • May 9, 2009 5:51am May 9, 2009 5:51am
Quoting Baba G
I started with less than 5 pence a pip when i went small live.As my account grew so did my lot size......then a family friend gave me his lolly and so and so and so.Thats the stress free bit.....now not then......Now i swing alot lot lot more than 5 p a pip BUT its the same boring old shizzer.

5p £5 £500 £5000 £500000..........watever.....same sh*t different day but all stress free..........g
I finally (after a lot of help ), no longer think about $per pip any more.
I risk x% of my account per trade and thats the trade. The better the entry the better my risk:reward will be. Its stress-free because no matter what happens my worst loss is only going to be that x % of my account.
If I'm in a trade that keeps going then I have to move the first stop to break even or better before adding another x% so my potential loss always stays the same on any trade.

I have also set rules for myself which will limit my losses if I hit a run of them. For example ... three losses in a row and I stop trading and see whats going on because I'm obviously reading the markets wrong.

Hope everyones having a great weekend ...
New trends for next week please!
Nic
  • #2,759
  • May 9, 2009 6:00am May 9, 2009 6:00am
Quoting Stuart14
Hi Strat.

It does and it doesn't!

I put away 12 months salary for living expenses and have no worries about that for now. So for 12 months I just trade what the market gives me, rain or shine.

What about next year though? If I haven't made enough this year for next year then the pressure is on.

Lets say my living expenses for the year are £50k, and my trading account is £200k. I need to make a 25% return this year to survive the next.

25% would be a damn good return on the year.

I understand the need to release the pressure of p/l from...

This is all very good Stuart14..

Thats why we dont put a TIME on your ability to support yourself from F.X.

To answer all your questions...for yourself....you need a yeild curve.....from both trending and consolidation market returns.........Then just by a glance at the boss bars you will get an idea if its a lion or lamb time and save or spend accordingly.

All my work is to get a 1% a month return to be as much loot as humanly possible so even in the dryest of bones the cuboard is not empty.


Visa versa if you aint ready taking a 2% hit when thats a few months wages might cause an engagement of the butt ring indicator....nasty

First things first......Price action.And keep the day job.......you could hit the path of learning and not open a live chart for a year and be well on your way.

Be really selfish and give yourself all the time in the world.I got kids....i always thought even if i never got there i could hand the baton on to my son.....we are talking about all the loot even a pirate would envy after all not just a wage.....g
  • #2,760
  • May 9, 2009 6:13am May 9, 2009 6:13am
Ok, this looks like being a very interesting week next week. There are a lot of pairs etc at key levels with some interesting PASR. I've done my week end analysis below:

Gold The monthly is still bullish as we have not broken the ascending TL from Nov to Nov 07 to 08. Weekly colsed with a higher close than previous and bounced off the TL from recent weekly lows combined with SR level at 885. Also closed above the descending TL from highs, so overall bullish gold.

FTSE 100 Jun Fut Monthly down Trend is still intact in my view. We had a weekly gap last week but now the PA is at a key wkly level. Although we have closed above the 4400 level we have not taken out the high of the daily S/Star on Thurs. Look how steep this last ascent has been too - unsustainable final blow off maybe? I have a short order in at 4340, stop above high of Thus candle.

DOW In my view this is the first major test of the recent rally - this is the first time a descending TL from the monthly has been tested. Flick to a line chart and draw a TL from the peaks at May 2008 and Aug 2008 and extend it. The Fri close is right on that TL combined with the SR level at 8465ish and the 23% fib from monthly H to L. Big test of this level on Mon. If European indices fall then DJ could follow. No PA on daily to suggest a top though.

Eurusd Monthly still bullish with up trend still intact. Weekly still bullish with close above M 50 ma and 13400 level. Now at another key weekly level of 13645. Daily just resting under that level with a huge rally on Fri. but still with a lower close than Mar 2009. Wait for PA at this level.

EurYen M chart had a big spinning top last month which shows indecision. W chart shows PA closed just under SR at 134.75 area with a lower close than 4 weeks ago. Looks like large retrace into S Star back on 6 Apr 09, and close right under W 50ma too. One to watch and wait for PASR.

USDYEN - M down trend still intact. Spinning top last month, again, indecision.
Weekly has closed under its 50ma and SR level at 98.96 although recent weekly rally is still intact. Dly chart shows IB on the 98.96 level with close in the 20/50ma wkly dead zone. Looks toppy and I'm inclined to point to short order below IB at 9815 just below the clustered 20/50 daily MAs.

GBPYEN - Looks like the M downtrend is still intact. Weekly rally has all the hallmarks of a bearflag. High of S/Star back in 5 Apr week still not violated either and on dly chart looks like a double top with a shooting star back on 6 Apr and Thurs gravestone Doji candle. Short orders below 147.88 with target of 141.00 and then 136.00.

Cable - M downtrend still intact as well as small weekly rally still intact. My daily feed shows a DBLHC but if gbpyen sinks this could follow. Not sure on cable really. Still looks bullish.

EURGBP - Monthly up trend still intact. Weekly shows a Hammer after recent weekly falls off 3 key SR levels and ascending TL combined with Fib from weekly L to H. would like to see a move above .8985 level and wkly 20 MA before considering a long.

AUDUSD - All 3 TFs lead me to bullish. Concern is the precipitous slope of the recent daily rally. Looks like a final blow off with PA caught under descending Monthly 20ema. Would expect to see a pullback to the 7460 sr level but overall still bullish.

USDCAD - Both M and W charts are still bearish but we could see a bounce off the M 20ema and 38% Fib level. Wait for a DBLHC but overall you wouldn't go against this stong downtrend until PA confirmation of a bottom.

USDCHF - M still in a down trend and W in up rally. PA sitting on top of the ascending TL from the lows so wait to see how PA reacts to this TL. Overall still bearish but if the indices tank then expect this pair to rally off that TL maybe? Depends on the flight to safety and whether people prefer the swissy over the greenback. Could be a good fade of the break of the 1.1250 level for the risky trader - not one for me tho!

EURCAD - Interesting level and PA. M and W uptrend still intact. The W chart shows a hammer off the ascending TL and 1.5441 SR zone and M 20ema. Only concern is that hammer body is not contained within the body of the previous candle. Long orders in above 1.5790, stops at base of weekly hammer. (1.5440)

CADCHF - M still in down trend. Weekly shows a S/Star off the fib and SR level at .9680 zone and W 50ma. This would tally with above analysis and points toward general CAD weakness next week. Are the clues in oil and gold and other commodities. If so then the AUD steep rise on the dailies could be under threat too. Short orders below .9595 stops at .9780.

NZDUSD - Monthly LT uptrend still live - Weekly recent rally still intact but PA at key level of .6047 zone combined with 50% fib level from M low to high. Tis level has held 4 times on the M chart, so expect some PA here. Again a high yielding currency that may have been funding the indices rally - the DJ and FTSE may point to this key level again being rejected and for this pair to tank.


Oil - charts suggest bullish run but it does look toppy. Could the clues be in the CAD? I'll leave this analysis to the Queen of Darkness!! Nic - over to you!!

I do like a bit of strategic thinking, so I may have mixed a bit of funnymentals here; so if that's not your bag and you are a pure Tech head pls ignore my musings on correlations. I read a good book,

"Currency Trading and Intermarket Analysis: How to Profit from the Shifting Currents in Global Markets (Wiley Trading) (Hardcover)
by Ashraf Laïdi (Author) "

that shows the funnymentals that drive the Forex market. Key is the yen and index correlation; borrow cheap to fund stock purchases in good times and pay it back when things go sour - bit simplistic but that seems to be the key. Look at the usdyen charts and then compare the relationship with index charts. More often than not bottoms in the usdyen have preceded bottoms in the index. Usdyen bottomed out on Feb 2009 with the DJI doing the same a month later. Looks like usdyen has topped out last month so it could follow again that the dow will fall this month. Lets wait and see.
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