Jacko's Forex House of Pleasure and Pain

This is what I feel I should have done. Look for PA at the level I'm shooting to enter at. PA will tell the whole story. As Jacko would say, I entered on a wild punt, but I'm going to let this trade play itself out. 100 pip TSL.

Low - don't beat yourself up, I took the same trade and do not regret it as I took it for valid reasons. Yes, ideally I would have liked to get in higher and watched what happened when/if it gets to 1.4000 but that might happen when I'm not around.

I've entered a trade at 13950 and the fact that it is not an A+ trade is reflected in my position size. I have another order at 14000 to make it up to a full position from a risk management perspective.

The only thing I am watching on my chart is the falling4HR trendline and the fibs from June 3rd - June 18th high/low. 38.2% fib is where the price has stalled and the falling trendline is now under 1.4000. Therefore, on this basis I entered a trade with 100pip SL, if this is breached then the resistance didn't hold and the trade is invalid from a reasoning perspective.

We have entered a trade early, i.e. befoe it has reached the top of the move and started to move down, but the fact that this is the case is reflected in my position size and the risk/reward ratio make sense.

You cannot pick 'tops' all the time and waiting for a top means you will miss out on trades. The price maynot even get to 1.4000 beore dropping and we have then missed out on a good trade where we picked the direction but were waiting around for the perfect entry price. You need to move with the market and not wait for the market to come to you.

We all think the direction is down in the short term and the price action indicates this to be the case (falling 4H trendline), you do not need to be 'in' a trade at the top or bottom of the move in order to make pips. Working full-time means you are not around most of the time to make a perfect entry in anycase.

The price action is still choppy, but Im comfortable that I have picked a trade on its merits and the entry point gives me enough leeway, if the price reaches 14050 then the trendline resistance has been breached in any event and is thus invalid.

I prefer to vary my position size depending on my confidence in the trade and the set up.

You are probably over trading if you are guilty of the following:

1. If one chart indicator doesn't have a clear trading signal, you switch indicators until you find one that does (or looks like it does). What you're really doing in this situation is trying to find a signal that you can read enough into to justify placing a trade. The fact is, there are times when there just aren't any good trades to be had and you should be sitting on the sidelines. If you can't accept that, you'll end up making lots of trades you shouldn't.

2. You feel the urgent need to place a trade within five minutes of opening a forex chart. Just looking at the chart makes you feel you absolutely must be trading right now, and anytime you open a chart you spot some trend or indicator that you should be taking advantage of. You're a bit like the person who needs to place a bet anytime they walk by a roulette table.

3. When you're away from your forex trading platform, you feel like you're constantly missing trades. You feel intense frustration and disappointment when you see a trade you could've made but didn't. You spend a lot of time thinking about those trades you missed. Sometimes you wish you could stay awake 24 hours a day because then you wouldn't miss out on all those trades.

4. You have a trading system but you constantly make exceptions to it. You have an ever-growing list of excuses and rationalizations for why you trade outside your system:

* You'll only do it once (until next time)
* You're not risking very much
* The chart is showing the perfect trade set-up and you'll miss out on huge profits
* Look how active the market it right now! I have to trade since everyone else is.
* I'm trying out this new experimental strategy (well, then try it out on a demo system)
* This trade is actually part of my system, since I keep extending my system to include all my trades
* My system hasn't been working lately anyway
* It'll take my system at least a year to make me rich and I want to be rich next week

5. You're focused on "the one big trade" that will make up all your losses, and you're willing to make dozens of ill-advised trades just to make sure you don't miss that big one. And guess what, you discover no one trade is going to make up for all you've lost in bad trades and spread costs. At this point you might as well be buying lottery tickets.

6. You think that trading more often will make you more money. "If I can make this many trades with the 5-minute chart, imagine how many I can make with the 1-minute chart!"

My experience has been the opposite.

7. You think that anticipation, anxiety, impatience, urgency, late nights, a pounding pulse, and the rush of adrenaline are all part of trading and there's no way to trade without them. You're under the impression that you're more likely to trade well under these conditions.

8. You make trades so you can tell people about them. "Yeah, I traded the zloty at 3:00 am last night - pretty crazy, eh?" Yes, you're a brilliant, maverick currency trader, and you'll be broke in a month.

9. You have a "gut instinct" for trades that makes different, contradictory predictions every time it kicks in.

10. You can always find a way that your trade could have gone well, if you'd only done X, Y, and/or Z, and you resolve to do all of those next time. In fact, just to prove how well they'll work, you're going to trade again right now.

11. You cut short your weekend so you can trade on Sunday evening when the Asian markets are open. In fact, you find the whole weekend concept very inconvenient since you'd much rather be trading on Saturdays.

12. You have a history of being addicted to things and forex is the latest. This is no joke - there's a very real high to be gotten from trading, akin to the high from gambling or other addictive activities, and if you're especially sensitive or vulnerable to that type of response, you should be very careful about venturing into the currency markets. This is related to #7 above - many of the reactions I listed there are part of a potentially addictive physiological response, particularly for those with a predisposition in that direction.

Some quick charts for Daily and 4H.

I've actually cancelled my order at 14000 as Im off work today so prefer to watch the price and trade live. 50% fib at 1.4050.

http://i42.tinypic.com/whi06o.jpg

http://i41.tinypic.com/4hw7wn.jpg

Excellent!!

b-plan a great post!

gambling vs. bussiness.
trading for me, has to be "boring".

Price reached 1.3990 and bounced off the 4HR downward trendline to the pip. No real motivation behind the price though at the moment, perhaps news will drive it downwards.

We have a triangle formation forming too with the pivot (midpoint) at 1.3940 which is where the price is at the moment.

I'm still in trade from 1.3950 and have a small position short at 1.3980 both with 100pip TSL.

It’s looking bleak for those of us waiting for 4000. Here is my 4H chart as of 8:25 NY AM, NY Time. The two dashed lines towards the bottom half of the chart show the triangle that had been forming as of around 3 days ago. The top part of the triangle had served as a support line that has rejected price since it broke out of the triangle yesterday. That seems to be the only hope for us on the sidelines.

Now notice how price has been rejected by the 50% fib line around 3960. Then notice the descending 4H trend line above that. That line is now a good 20-30 pips below 4000. I’m adjusting my thinking to where I will watch price and if it goes above 3970 I’ll enter on the way down to 3970. If it goes past 3960 but not above 3970 I’ll set my order to activate at 3960 on the way down. IF none of those things happen I’m staying out. While I still think the ideal price is 4000 I’m losing hope based on what I see on the charts. All thoughts appreciated.

EDIT: I originally made references to 4060 and 4070 when I meant 3960 and 3970.

RickyRudy - what is the significance of 4060 / 70??

The price does seem to be hanging around just above the 3900 area as support at present...but I feel more so because it is previous horizontal support and 38.2% fib of recent move. Zoom out a bit on your chart or go to 1H to see the horizontal cluster more clearly.

The price is waiting for some momentum like it was this time last week. The 4HR falling trendline should be the strongest S/R line and that it what I am trading off for the moment, just hope we don't have spikes up to take out stops beyond this level as has happened before.

Those numbers were mistakes written by me. I revised my post to clarify that I meant 3960 as in 1.3960 and 3970 instead of 4060 and 4070 respectively.

The price has gone as high as 3976. I've executed my plan by placing one half position at 3960 with a 100 SL. If we get further to say 4000 I will execute the other half either at point or on the way down.

I have been watching the charts and the discussion the past couple of weeks. Just out of curiosity here are a couple of quesitions that I have.

1. Are you all trading an up trend or a down trend? It appears that many are trying to catch every little pip, in which many have caught some positive ones, but why so many trades lately that don't totally seem to correlate with some of Jacko's rules, ie 50% fib and round numbers on an established trend?

2. Why are many taking trades not at the traditional round numbers, ie 1.4000, 1.4050, 1.3900 etc?

3. It also seems that some are using limit orders trying to hit the top or the bottom exactly. Why not wait for price action and movement to establish something solid?

Anything else I am missing?

Thanks,
RCWSO

Got the second part of my position filled at 4000. Damn, Jacko is good. Now let's hope this baby plays out as planned by giving us some nice pips.

We are not 100% sure of the trend at this moment, though the consensus is that it is down. This could be wrong however. Something similar happened last may/june/july as price consolidated for three months, and those attempting to trade Jacko's method ended up taking trades both directions until price told them which way to go. I for one am struggling with this method, because the entries I am looking for tend to occur while I'm asleep, so my choices are to enter blind with limit orders, enter early, late or not at all.

Hope this helps.

Hi Rcwso,

It depends entirely on the time-frame you're using. For example, I see the 4H trend as up over 300 bars, but the 1H (for those who trade it) is clearly down. Also, some members of Jacko's group go counter-trend, trading Jacko's predictions for where the market will go, before taking the conventional trend trade. Even with simple rules, trading styles differ hugely - I suppose this is one of the shortcomings of posting on forums: explanations are generally limited.

Pass. I'm sticking to the round numbers and Fib50. My guess would be that the rules provide us with the basic tools to trade, but once they are mastered there's more room for nuance (as long as we don't lose sight of what we've learnt).

I nearly always wait for a move through the target level (Fib50, S&R, round number) before catching the market on the way back. Again, it's all down to individual trading style.

Taking a look at the daily chart, then strictly speaking we should be entering a trade at 1.4050...50% fib from which coincides with falling trendline at around 1.4042...nearest round number 1.4050...

I exited earlier 2 trades at break even and am now short from 1.4000.

Positive US data today is driving price up.



http://i39.tinypic.com/vxcftw.jpg

Good Post plan-b

Jim always says to treat it like a business in order to be in it for the long haul, most of the people treat it like a casino and hope to get lucky.

Next time you're about to place a trade imagine that your forex account is the only money you will have for the rest of your life and you can only live of the forex profits... if you really do this before every trade, that will have you thinking twice about taking that D+ trade or risking 35% on a single trade of the 1 min chart hoping you can double your account before the weekend.

Your subconscious mind will not allow you to screw up if you start believing that you need to do this in order to survive and you’ll find yourself more in tune with the market and thinking more for your self rather than listening to everyone to justify you next mediocre trade.

A lot of people lose because they subconsciously know that it’s not that big of a deal and if they blow their account they can always open another and another.

Great short action from 1.40

http://i40.tinypic.com/apik9h.png

100 pips in the bag.
Thanks, Jacko.

Looking good so far!

I jumped in with you earlier at 1.3953 after seeing it reject the 1.40 level.