I realized I didn't really touch on this question as I was posting to the blog:
Q: "I really would like to reach the level where I can analyze economic conditions, market sentiment, equities and the Dow so as to make better decisions. But then again would that work with my 1min time frames?"
A:"With the style of trading I use, I wait for the move to happen, not anticipate it. News and other events, indices, move the market, I watch for the move to start, then jump on it and go for a ride. I liken it to jumping on a train: Would you rather get on a train that you guess is going the right way, or would you rather get on a train that you know is going the right way? Yes, of course. I'd rather be pretty sure I'm going the right way, rather than just wingin' it!
As far as following news, the Dow, etc. Movement of the currencies, depends largely on economic conditions. With the world economic crisis in full swing, risk aversion/appetite is the norm. Just up until a year ago, if the DOW was up, it was generally good for the USD. Now, If the DOW is up, it drives risk appetite, and drives currency investors to branch out into other currencies. Presently, when the DOW is down, the world uses it as a economic "measuring stick" of things to come for the rest of the world, and drives investors into the USD as a safehaven. That will probably change if the US keeps leveraging itself deeper into massive debt. If and when that time comes, will have to learn to adjust. There is no crystal ball, so that is why it is so important to not over leverage your trades. The best thing you can do is try and keep yourself up to date with the worlds economic news, almost by the minute, while you trade. One very helpful tool is Keeping the news on, so you can listen while you trade. I really like Bloomberg, and that is why I was so happy that I figured out how to add it to my blog. Now I have it on, and it can run in the background while I watch charts. I have it on constantly during my trading sessions.
One important note surrounding news events, which I always remind everyone when I post setups, is to always check the news calendar t see what events are coming out during the trading day. Be aware of the news that could effect the PA of the currency pair you will be trading. Be very aware of the time, and make sure you have stop losses set, and probably tighter than you normally would, just in case the news spikes the price in the direction of your stop. Spikes can be huge, and you want to protect yourself for a spike in the wrong direction.
As for your timeframe, sclaping the 1 minute charts, the only thing you could base your trades on is directly after key news announcements, ie. GDP, or Non Farm Payroll. Otherwise, I think it would be difficult, unless you can get a feel for general market direction, during a trend and the fundamentals driving it.
Thanks for the great questions!"
Q: "I really would like to reach the level where I can analyze economic conditions, market sentiment, equities and the Dow so as to make better decisions. But then again would that work with my 1min time frames?"
A:"With the style of trading I use, I wait for the move to happen, not anticipate it. News and other events, indices, move the market, I watch for the move to start, then jump on it and go for a ride. I liken it to jumping on a train: Would you rather get on a train that you guess is going the right way, or would you rather get on a train that you know is going the right way? Yes, of course. I'd rather be pretty sure I'm going the right way, rather than just wingin' it!
As far as following news, the Dow, etc. Movement of the currencies, depends largely on economic conditions. With the world economic crisis in full swing, risk aversion/appetite is the norm. Just up until a year ago, if the DOW was up, it was generally good for the USD. Now, If the DOW is up, it drives risk appetite, and drives currency investors to branch out into other currencies. Presently, when the DOW is down, the world uses it as a economic "measuring stick" of things to come for the rest of the world, and drives investors into the USD as a safehaven. That will probably change if the US keeps leveraging itself deeper into massive debt. If and when that time comes, will have to learn to adjust. There is no crystal ball, so that is why it is so important to not over leverage your trades. The best thing you can do is try and keep yourself up to date with the worlds economic news, almost by the minute, while you trade. One very helpful tool is Keeping the news on, so you can listen while you trade. I really like Bloomberg, and that is why I was so happy that I figured out how to add it to my blog. Now I have it on, and it can run in the background while I watch charts. I have it on constantly during my trading sessions.
One important note surrounding news events, which I always remind everyone when I post setups, is to always check the news calendar t see what events are coming out during the trading day. Be aware of the news that could effect the PA of the currency pair you will be trading. Be very aware of the time, and make sure you have stop losses set, and probably tighter than you normally would, just in case the news spikes the price in the direction of your stop. Spikes can be huge, and you want to protect yourself for a spike in the wrong direction.
As for your timeframe, sclaping the 1 minute charts, the only thing you could base your trades on is directly after key news announcements, ie. GDP, or Non Farm Payroll. Otherwise, I think it would be difficult, unless you can get a feel for general market direction, during a trend and the fundamentals driving it.
Thanks for the great questions!"
:
. Actually, the more it follows the pattern I described, the more confident I am in executing a trade on a break.
