(binned per thread starter's request) For What It's Worth

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As a new member of FF, I thought I would add my 2 pips worth to this site by starting this trading journal. I will, from time to time, present a sample of my trades from the current trading day. I am putting this on FF because I think there are a few good forex traders here, and I am open to your ideas and comments on what I am doing (it's working for me). I will gladly exchange ideas with anyone, but please do not be offended if you are a new trader, because I am not trying to help new traders figure out how to trade.

So, here is what I traded this morning on the EURUSD. Trade A was in at about 3:10AM CST. It was my first trade of the day and I was not looking for more than 30 pips, which I captured. The next trade, B, was later in the morning and was a result of the "squaring up" of the move down. My strategy was to enter at B and hold on to it until the -.786 fibo was hit, which it did. All in all, a slow morning but a few pips are in the bank to start the week.

Here is a chart for referrence:

Re: the trades from this morning. New traders should avoid trading against the trend. The trend on the Day chart was up, so trading the retracement (trade A) was against the trend. However, once the retracement was over, I like to jump on the move back with the original trend. The move down opened a gap of sorts that needed to be filled by the market. This squaring up process is a great trading opportunity. The process started at about 1.4000, and that price level is the target of the up move.



Question for tonight: is that a head/shoulder formation for a continuation of the up move? We'll see.

GBP$ - Day is up, 4H is up, 60 is up.
EUR$ - Day is up, 4H is up, 60 retracing.
EUR/JPY - Day is up, 4H is up, 60 is retracing.
$/JPY - Day is down, 4H is down, 60 is retracing.

Possible divergence on the GBP$ and EUR/JPY.

Edit: As of 11:00 AM CST, GBP$ continues to push higher; EUR$ and EUR/JPY continue with retracement; $/YPY may be returning to trend, but also may be stalling/going into a range here.

Ed, re: GBP Trade: Entry was at 1.5986. Move stop now (11:22) to 1.6055, target still 1.6150. 1.6075 is stalling and given the time of day protect profits for the day. Go get lunch and enjoy the afternoon.

Staying focused on the GBPUSD, expect the price action to move down to about 1.5940 to square today's action/gap, before heading to the 1.6150 target. New information, though, that may change things: US found less interest than anticipated in the auctions today, so this could lead to some real fireworks later. Heads up and stay flexible.

USDJPY trade this evening after Tokyo open. A break of a previous significant level at 95.48/50 and a quick buy. Risk was small at 15 pips and a target of at least 40 pips. Keep the TA under the covers and here is a chart of the trade:


The hook back to the 95.48/50 level (critical move) after entry helps confirm the trade.

Traded the GBPUSD up all morning. Then a nearly perfect example of a quick retracement trade presented. Entry is at A (1.6112) where the fibo base is breached (notice that the price action failed to reach the previous high). Once the base is breached the first target is the -.27, the second target is the -618, and the third is the -786 (at 1.6076). I had a small position on this, with a tight stop and a limit of 1.6075.

Here is the chart:


A better entry was probably the engulfing candle prior to my entry a candle back.

If anyone is reading my posts, be sure to take a moment to also read the thread on the 5 second "L", which outlines an approach that should work on just about any time frame. Slightly different from my approach but it can work with minimal risk and maximum reward.

Very busy morning. Posting some information on my GBPUSD trades. Three in total on the pound. Trade "A" got things going after the trend line break and the hook back. From there, just enter after the pull backs (check the 5min or 3 min. charts for a better view of this price action).


Similar trades today on the EURUSD and the EURJPY.

Today was a great trading day. Too tired to post a chart. Would recommend any new traders take time to study today's price action on the EURUSD, GBPUSD, and USDCAD. It is a million dollar lesson in how the markets work.

Quick chart on the EUR/USD as of this post. A strong move south this morning is showing some signs of a turn or retracement back north, possibly to square up positions left stranded last night. Here is the chart showing the move to the -.27 fib, with possible levels to achieve at the -.618, -.786, and -1.27 (maybe beyond). Of course, much more to this picture than room to discuss here, but its a beginning.

My GBP trade from this morning. I detected the change in trend (after a nice run down while I was sleeping), and entered after the fib top was breached. My target was the -1.27 (actually just above it) and as you can see I left some on the table after the move really took off. I will analyze again later for trend, to determine if we are going up or down. FYI -- I will gladly take 50 pips on a reversal trade, but if this were a trend-type trade I would be upset that I did not get more of the run.

Nice journal! Keep up the good work!

I've been spending a lot of time participating on another thread and have neglected my own thread. It's time to get back to work. I will make some notes on my trading approach and start posting them here (there are many topics to cover), as well as posting my "Trade of the Day".

Rule #1: Trade with the trend.
Rule #2: Be careful when trading counter-trend.

I like to trade in the direction of the 4H chart. I know, many traders trade the Day trend. I am aware of the Day trend when I am trading, and view the 4H trend as being either with the Day or a retracement of the Day trend. I will counter-trend trade when the 1H chart shows clear signs of making a turn against the 4H trend. I could go on for hours on trending but will not. Let's keep it simple.

Next post: support and resistance.

Let me insert something here that may be important for new traders. One of the things that must be included in your daily technical analysis is selection of the currency pair/pairs that you will focus on during the trading day. I have my approach to doing this, but it is important to be looking at the market action that is most likely to present a trade that meets your trading strategy. I know that sounds simple to most experienced traders, but I have noticed throughout FF that people are trying to force trades into market action that simply shows no signs of action. You improve your chances of success by executing your strategy in a suitable market.

Instead of just going on about support and resistance (and other TA topics), I am going to take a different turn with this thread. There are lots of places to learn about TA so I will assume that if you are reading this, you have developed enough skills to understand what I am saying. Enough said.

This last week was a good week. Typically I work up 6-8 currency pairs each morning, and then select 2-3 for intense focus for the rest of the day. Given my trading style, I am looking for currency pairs that will most likely meet my trading strategy. I spent most of the week focused on the $/CAD (because it had been trending down with a three or four week long retracement that had reached the .386 fibo and stalled out). Once it started to fall on Monday, it was easy to follow on the 60M chart all week. Wednesday proved nice trading across many pairs, and I got focused that day (and the remainder of the week) on the EUR/JPY in addition to the CAD. The rest of the week was mostly scalping when the opportunity presented itself. For the most part, I avoided the EUR/$ and GBP/$ all week (I think only one GBP/$ trade this week).

In addition, when trading the CAD, it is a good idea to watch the price of oil, and the Canadian economy is tied to oil prices. EUR/JPY trading often gets started when US equity futures start changing so you might want to keep an eye on that index, too. Finally, I like to keep an eye on dollar index throughout the day.

For next week, as with any week, I recommend getting your TA done before the open of each market, then trading PA when PA fits your analysis. Otherwise, sit tight and wait. Remember, your best entry risks small but wins big. If you can't see both ends of your trade upon entry, don't.

For anyone who has been following the $/CAD move, here is a quick day chart showing what it did last week and where we are at the beginning of this new week. Notice that the price has settled on a .618 fib and stalled. In addition, the low of this move south exactly hit another price target that is not on this chart but would indicate a possible pullback north to start the week. Keep an eye on the price of oil which can give signs of a continuation south or a pullback north. I will skip a discussion of possible targets for a later date.

Well, here is an update on the $/CAD. This is a 1H chart vs. the previous Day chart view, and as you can see, the .618 did not contain the south move and instead the .786 has, at least for now. Still waiting on a better chance to go long, but not quite yet for me. I have continued to trade this south this week, with an eye on a turnaround.

CAD has completed its retracement and is now very close to the recent low at 1.0785. Decision time? I traded it down all last week and am going cautious for the start of next week, but if the pace of dollar weakness picks up next week, we could see another strong move south. Not sure what will happen, and will follow PA.