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Trend Trading Chart Thread

  • #21
  • Aug 7, 2009 8:13am Aug 7, 2009 8:13am
Quoting moosley
long @1.43 stop 42 trg 45
What is trg?

The good news is that price went down, the bad news is that is Friday afternoon and it would risky to post an order now.
  • #22
  • Aug 7, 2009 10:12am Aug 7, 2009 10:12am
Quoting fxacs
What is trg?

The good news is that price went down, the bad news is that is Friday afternoon and it would risky to post an order now.
Yep... you wait all that time for price to go where you want it and then it does it on NFP Friday!

At least we can have a break over the weekend and come back to trading with a fresh outlook on Monday!
  • #23
  • Sep 10, 2009 12:59am Sep 10, 2009 12:59am
It looks as though those trends might be coming back so it's time to start posting a few more currency charts.

But first... I did say that I wanted to talk about using this method on other markets too, so I would like to post a chart of a trade I am currently in.

It's a buy of the UK Stock Marks & Spencer Group Plc. Personally I find stocks easier to trade because they move a lot slower than Forex, so it's more about adding to my portfolio than trying to make a quick buck! Most stocks I trade using the daily charts and I have adjusted the size of my stop loss to suit the stock traded.

In this particular example I am using a 20 point trailing stop.

Price is moving in a nice upward trend, forming a pretty good channel to trade in. Price came down to test the support trendline, just below the 50% fib level and failed twice at the 280 level. I decided to go long at 290 and set a 20 pip trailing stop loss. Currently price is up around the 360 area (although we are heading down today!) and my stop loss is at 350. If I get closed out I will be happy with a 6% return on that trade. I suspect I will also be looking to get back in!

Regards,

Dan
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  • #24
  • Edited 2:15pm Sep 10, 2009 1:53am | Edited 2:15pm
I am currently in a long trade on GKN (another LSE trade). But not the first... the story goes like this...

Trade 1

A test of the support trendline just below the 50% retracement level (almost hitting 61.8% to the point). As price came back in I went in at the 70 level with a 10 point trailing stop. Closed out by the trailing stop at 80 for a 10 point (or 2%) profit.

Trade 2

Price retests the trendline and 50% retracement level. Another chance to buy, this time at the 75 level. Price made it up to 115 before taking me out at 105 for a 30 point (or 6%) profit.

Trade 3

Now this one is a touch different. Although I don't trade price action setups on their own, when they look real good, at a real nice level and in direction of the trend they are hard to ignore!

I was hoping for price to make it a little lower (ideally to the 50% level at 96.62 but the important psych level 100 held it's ground. I decided to go long at 110 if it made it there, which it did. The trade is now at breakeven, so it's time to sit back and let the market work it's magic!

Charts attached... hopefully in the right order!
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  • #25
  • Sep 10, 2009 2:06pm Sep 10, 2009 2:06pm
Not sure if anyone is watching U/J using this strategy but it is well known to respect the 50% retracement level and is good with trendlines and round numbers!

Keep your eyes open for something here!
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  • #26
  • Sep 16, 2009 7:55am Sep 16, 2009 7:55am
Just a quick follow up to my last post... I was asked about this trade in my journal and I responded that I would probably pass on it because it was actually at the bottom of a downward channel that could be seen on the daily chart (attached).

I felt that could cause a problem so I didn't take the trade. However, you could have taken the trade and knowing about the channel you could have made a profit.

So what is the point of this post... always remember to keep an eye on the big picture!
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  • #27
  • Sep 17, 2009 12:15am Sep 17, 2009 12:15am
Great, clear analysis. Keep the posts coming. Enjoy your work

Do you trade other yen crosses such as g/y or e/y?

Thanks Dude
  • #28
  • Sep 17, 2009 3:15am Sep 17, 2009 3:15am
Quoting Opium
Great, clear analysis. Keep the posts coming. Enjoy your work

Do you trade other yen crosses such as g/y or e/y?

Thanks Dude
Hi Opium,

Yes I will pretty much trade anything that trends! That includes other markets too!

I do keep separate accounts for my different types of trading though (although they are all based on this trend trading method).

My main account (my big money account... well for me anyway!! ) is for trading E/U and G/U. I have another account for stock trading and a smaller FX account for trading other FX currencies that I am not as familiar with as I am with E/U and G/U!

I gather you play the yen crosses? Please feel free to join in the conversation anytime!

Regards,

Dan
  • #29
  • Sep 17, 2009 6:33am Sep 17, 2009 6:33am
Hi Dan,

Just wondering, when you mention about other currencies that you trade in a sepperate acc. Do you apply the same method as in e/u & g/u?

Same SL sizes or would you vary them based on the individual currencies volatility, like for example G/J or E/J being more volatile, would you place say 200 SL instead of 100SL?. If so how would you calculate it?

Cheers mate.
  • #30
  • Sep 17, 2009 8:24am Sep 17, 2009 8:24am
Quoting Pipalicious
Hi Dan,

Just wondering, when you mention about other currencies that you trade in a sepperate acc. Do you apply the same method as in e/u & g/u?

Same SL sizes or would you vary them based on the individual currencies volatility, like for example G/J or E/J being more volatile, would you place say 200 SL instead of 100SL?. If so how would you calculate it?

Cheers mate.
Hi,

Yes you are correct - I use the same method but different stop sizes. For example on a lot of my stock trades I am using 10 or 20 point stops because that is what is appropriate. I do not have a specific formula for calculating stop sizes. You could use the ATR tool to guide you.

The way I do it is by eye basically... I am looking for a stop size appropriate to the time frame I am trading that is big enough to withstand the up and down swings without getting stopped out due to market noise but also not so big that it takes a month to turn a profit! Unfortunately that bit of trading is down to discretion only... which is actually part of the reason I started this thread; because I would be interested to see what other people use, who may have more experience than me in trading other currencies!

Regards,

Dan

PS... One way to find out what works is to back test a theory, such as a 200 pip stop loss and if it seems to be appropriate run it live demo only and see what results you get.
  • #31
  • Sep 17, 2009 11:05am Sep 17, 2009 11:05am
Quoting DanUK
Hi,

Yes you are correct - I use the same method but different stop sizes. For example on a lot of my stock trades I am using 10 or 20 point stops because that is what is appropriate. I do not have a specific formula for calculating stop sizes. You could use the ATR tool to guide you.

The way I do it is by eye basically... I am looking for a stop size appropriate to the time frame I am trading that is big enough to withstand the up and down swings without getting stopped out due to market noise but also not so big that it takes a month...

Yes I see what you mean. I believe its best way is through experience because it obviously depends on the objectives of each individual trader, be it to open and close within a session or to swing for a few days, in which case a wider stop would be neccesary. It aint the same on dailies than in 1h within the same currency IMO, so that in itself would vary between having a 200pip stop on G/J as opposed to 100pip.

Somehting that IMHO sounds very logical would be to roughly see the ADR of a currency and base it on that if the goal is to swing a few days, obviously giving it enough breathing room in a single day so as to wiggle around and do its bit.

The one thing that always makes me think is with regards to backtesting. Maybe you could clear me up on this. One can backtest as long as they want and say 50 pip stop is the best for this currency, but that in itself is based on backtesting the past. What hapens in 3 months time when conditions change again? Do you go back to backtest the past? Or demo trade the present? What happens if once demo tested you go live and conditions once again change? lol!! might of got a bit waaay to thoughtful here. Like jacko says...leave your brain at the door.

It does ponder my mind a bit though....

Any thoughts or do you think im complicating things?
  • #32
  • Sep 17, 2009 11:20am Sep 17, 2009 11:20am
Quoting Pipalicious
Yes I see what you mean. I believe its best way is through experience because it obviously depends on the objectives of each individual trader, be it to open and close within a session or to swing for a few days, in which case a wider stop would be neccesary. It aint the same on dailies than in 1h within the same currency IMO, so that in itself would vary between having a 200pip stop on G/J as opposed to 100pip.

Somehting that IMHO sounds very logical would be to roughly see the ADR of a currency and base it on that if the goal is to swing a few...
Hi,

Yes using something like ADR may work. The thing is that you tend to find out what works best when you actually put it to practice. For instance, some time ago I was asked whether I thought a 100 pip stop was appropriate for G/U considering I was also using a 100 pip stop on E/U. My response was; maybe my stop should be bigger on G/U or smaller on E/U but for now that stop size is working just fine so I will stick with it until it proves me otherwise!

You are right in saying that a back test will be different to a forward test or live trade because conditions change BUT these kind of changes take time to happen or they change due to significant fundamental circumstances; such as the massive sell offs that happened last year due to the credit crisis - things moved quickly then because of panic.

So I think what I am trying to get at is... don't complicate it too much; take the last three months or so (I would suggest before August, because August is the crazy month!) and run through and see what the best size stop would be - that you are comfortable with. Take the cautious side... remember it is better to get rich slowly than to go broke fast, so if in doubt choose a slightly bigger stop. If you think 100 is too tight but 200 is too much then go for 150 and then demo trade it. You will soon get a feel for it. In my experience the simple act of actually putting these things to the test tends to give you the answer... and the beautiful thing about this business is that if you want to test out different things you can with absolutely no risk... on demo. I can't think of any other business in the world where you can simulate your business the way you can in this one!

I hope that is of some help to you. And if you do start to test it I would welcome some charts and trade setups that you are thinking about here. Demo and/or live trades are quite welcome here... it's all about the theory!

Regards,

Dan
  • #33
  • Sep 17, 2009 12:42pm Sep 17, 2009 12:42pm
Yes iŽll start testing .

Thats one problem ive noticed with me and I tend to over analize alot of stuff. I also do too much "theory" and not so much practice, although ive been changing this in the last 2 weeks so im getting there bit by bit .

Thanks for your time mate.

IŽll post some charts if i spot anything.

By the way, what do you think of AUD/USD and NZD/USD? Both seem to be trending fairly well... Are there any specific currencies you stick to (apart from e/u - g/u) or you open to any?
  • #34
  • Sep 17, 2009 12:53pm Sep 17, 2009 12:53pm
I'm open to any really... if there is a clear trend then I am interested. AUD/USD is one I am definitely watching.

Theory is good... too many people jump into trading without grasping any of the theory behind it... which is half the reason so many people fail. But once you've got that down, open up a demo account and put the theory to work! If you can stay profitable for three months on demo then open a SMALL live account and go for another three months. If your theory is good and you are staying profitable then you can SLOWLY increase your position size. And that's it! Simple!
  • #35
  • Sep 17, 2009 3:50pm Sep 17, 2009 3:50pm
Hi dan, this looks a great thread you have started as is your other one hope to contribute soon have been looking at other pairs seems to work very well could be just a case of which pair or pairs are trending at the moment and sticking with them.ps i also took the gu trade stopped out at break even.
  • #36
  • Sep 17, 2009 11:57pm Sep 17, 2009 11:57pm
Quoting castlerock
Hi dan, this looks a great thread you have started as is your other one hope to contribute soon have been looking at other pairs seems to work very well could be just a case of which pair or pairs are trending at the moment and sticking with them.ps i also took the gu trade stopped out at break even.
Hi,

Welcome aboard! I hope the thread continues to grow as I am convinced this type of trading is one of the best ways to do it!

G/U is still a tricky call to make... my G/U chart is looking quite bearish but still stuck within a range however my E/U chart is looking pretty bullish. So for now I think I will stay out of G/U until we have a clearly trend emerging!

Regards,

Dan
  • #37
  • Sep 18, 2009 1:35am Sep 18, 2009 1:35am
Hey dan great work on making this thread mate, ive been looking to try jacko's method on a couple of other pairs to try get a better grip of it.

Having a look at audusd:
We are in an obvius uptrend. There is resistance at 0.8656 from this time last year, and the 50 fib is at 0.8669.
I am a buyer @0.8654, SL @0.8600
What do you guys reckon?
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  • #38
  • Sep 18, 2009 4:06am Sep 18, 2009 4:06am
Quoting Pipscalibur
Hey dan great work on making this thread mate, ive been looking to try jacko's method on a couple of other pairs to try get a better grip of it.

Having a look at audusd:
We are in an obvius uptrend. There is resistance at 0.8656 from this time last year, and the 50 fib is at 0.8669.
I am a buyer @0.8654, SL @0.8600
What do you guys reckon?
Hi Pipscalibur,

Yes I like A/U for a long. I currently have a long open on A/U on my mini-account from 0.8300, which I will keep trailing with a 100 pip stop (currently at 0.8600).

My view is a little more zoomed out than yours I think... if we do get a price retracement here my area of interest is to get back in at the 0.8500 area. What I would like to see is how I have the orange arrows drawn on my chart... but what I would like and what I will get are often two different things LOL!

Regards,

Dan
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  • #39
  • Sep 18, 2009 9:58am Sep 18, 2009 9:58am
Hi Dan,

When you say you got in @ 0.8300, do you only enter in 50 fibs retracement or are you "flexible" with this (23.6 - 38.2 - 61.8) as long as theres additional confluence? Just wondering since Jacko sticks to 50 only I think.

I noticed 0.8300 lands right in the middle of 50 & 61.8 fibs...

Probably repeating myself (im a bit of a blockhead sumtimes lol!) but your reasoning for this entry was the bounce of 0.8250 ish, TL, 50/61.8 fib and consecutive entry 50 pips above, entering at 0.8300. Am I correct in this reasoning or am I missing some other reasons?

Also, when placing Fibs (being subjective per trader) how do you decide which swings to place them on? The most recent? Dailies? 4h? (since you trade of it)? Would you consider placing 2 fibs to "double check" confluence?

cheers dan.

I must say that your threads really helped me understand a lot of this method. Im happy to have found your threads dude. cheers.
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  • #40
  • Sep 18, 2009 12:34pm Sep 18, 2009 12:34pm
Anyone been watching U/C?

4h chart.

Fib Swing High @ 1.0927
Fib Swing Low @ 1.0600

Fib 50 aprox 1.0750

Price bounced and I entered @ 1.0700 with a 50 pip stop (1.0750).
IMHO because I see a fair amount of congestion down below (1.0650 - 1.0600) so I wanted to keep it rather tight. I will trail every 50 pip in my favour.

Also a PB (ish?) in our favour, in 1h, 4h & D1 (IMO).

PS: Not changing your approaches Dan (my SL), just it is my way of adding discretion to the method. Still learning but I didnt want to leave it wider, especially on a Friday.

Have a great weekend guys & gals!!
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