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  • #1,601
  • May 6, 2010 9:22am May 6, 2010 9:22am
Well, it sucks to be right and greedy at the same time. I pulled out of my EUR/USD short early, with about 120 pips. It's gonna go to 1.24, but I got antsy. Was stopped out of two other NB 4H trades for small losses, so I'm done for the week. I don't trade on NFP day, and the news today is causing almost as much chaos. the Yen is tanking as well all of a sudden. Better to wait for things to calm down on Monday. Have a good one!
Disregard all prognostications.
  • #1,602
  • Edited 2:46pm May 6, 2010 2:35pm | Edited 2:46pm
Quoting astral77
Hi BOB

Like you I have open positions USDCHF and NZDCHF deep in DD. I am going to hedge USDCHF at 1.1200 and NZDCHF at 0.8150...I am still up 10%, however, if we did not have had this mess with the European crisis it would have been 45%!
Hi BOB

Well what can I say!!! What difference a day makes. 24 hours ago I was down almost 5000 pips. 12 hours ago when I wrote the above post i was down 4000 pips. Since then My account is back up again. 15th March I opened this account with $1000, I added another $1000 yesterday to cover any margin issues and now the balance is $2457, with open positions of -$100. Price never hit 1.1200 and 0.8150 so no hedge.

I am still not settled in with H4 TF and not used to it. I think the events of past few days fully vindicates your system. Since the market is very volatile at present (NZDJPY 600 pip movement in 8 hours) I am not opening any more positions till Monday. It would be interesting to see how other systems in FF have coped with the events of this week.

Kind Regards
P.S. JUST HAD A LOOK AT GUPPY! JUST SPEECH LESS! Hope no one played the system with this pair.
  • #1,603
  • May 6, 2010 2:41pm May 6, 2010 2:41pm
I closed yesterday all my trades lost all my April profits and some of Marches. No need to post all that stuff. I am no longer going to trade with a broker that I cant hedge trade. Indicators are useless during super news stories and the NFA morons have made everybody vulnerable to giant market moves without hedging. I dont see a very good future, I see a market that is going to be news driven and I am not a news trader, dont want to be. The 6x6 probably will work in keeping you out of the market if it jumps like crazy but as you can see picking off tops and bottoms like we did in April can get you into trouble during super news stories. I am going to sit on the sidelines for a while because I really dont know how to trade the news and this market is going to be news driven for weeks or even months to come. Unlike Oct. 2008 when the market was rocked by a couple of news stories, I am afraid big news stories could rock the market several times with European countries possibly gong bankrupt, major changes coming in the Euro (watch Germany and what it decides to do) and recovering economies changing interest rates. I wish you all good luck but I am not going to try to trade this market, way too unpredictable and volatile for me without being able to hedge. I am going to close my IBFX account and move to an account that allows hedging. I never want to go through another session like this again. I could have hedged all my trades two days ago and sat the week out and kept my profits. I hate the NFA, they are a bunch of goons.
  • #1,604
  • May 6, 2010 2:52pm May 6, 2010 2:52pm
Hi Bob,

I just got to the thread. I think your system is great. You may be right in the 'news trading', but maybe that is an add-on that we can think up. I understand your recovery plan is great as well, but using PA stops w/ bottoms, tops, would maybe make more sense? I used your system for last 1.5 days and I am not hit bad at all?

I am curious at what bad trades I missed? I think I got the pivots?

Your system works, your broker sucks... But that is an easy fix. Hang in there, you created a good system for most days. I tried to 'brake' your system today and it still did quite well. It kept me out of the bad trades. Of course I got hit a bit, but days like this will sink most forex trading systems!

Unless you are a hard trending sort...

Days like these build better systems...
We are our own best indicator.
  • #1,605
  • May 6, 2010 3:35pm May 6, 2010 3:35pm
Quoting nanningbob
I closed yesterday all my trades lost all my April profits and some of Marches...I am going to close my IBFX account and move to an account that allows hedging. I never want to go through another session like this again. I could have hedged all my trades two days ago and sat the week out and kept my profits. I hate the NFA, they are a bunch of goons.
I hope you do reconsider. You have been an inspiring guiding light to me and a number of other people also. You keep reminding us that forex is hard work and you are quite right to be fuming at having 6 weeks of hard work gone down the drain due to NO FAULT of your own.

3 Months ago I asked IBFX when they are opening their UK office and they said 2 months. They are still waiting for the approval of the FSA and it could be any day now. In the meantime please find out if you can open an account with Gain Capital UK (UK arm of Forex.com), they are very simillar to IBFX in the level and quality of service the good news is that you can open an account with them. I have tested around a dozen brokers and after finding them unsatisfactory I kept only forex.com UK and IBFX.com.

Below is my chat with GainCapital UK (forex.com UK):

James D: Hello and welcome to FOREX.com UK. May I have your User ID (Account Number) or email address to better assist you?

you: HI I have an account with forex.com UK. My email is [email protected]

James D: Thank you for your information, how may I assist you?

you: I belong to a chat group at forexfactory.com some of the members are US citizens based in UK, China, etc. They are very upset regarding NFA rules regarding hedging.

you: My questions is because they are resident outside USA can they open an account with forex.com UK to be eligible for FAS rules

James D: Yes we are apposed to the rules as well, and have attempted to lobby against it.

James D: You can open an account under our UK subsidiary.

you: Thanks James so to be completely clear. A US CITIZEN LIVING OUTSIDE USA can open an account with GAINCAPITAL UK.

James D: US Citizens who live in the US, can also open UK based accounts.

you: That is very useful information. Thanks for your help. I will copy and paste our chat in our thread. Thanks and good bye.
  • #1,606
  • May 6, 2010 4:42pm May 6, 2010 4:42pm
I didnt ride the trades out like some of you guys did. I also had some trades that are outside of this system that went bad. I have not told anyone here but I also manage an account and two days ago I just hedged all the trades and said I will come back next week and see if I can straighten this out. I am sitting on less than a 1000 pip DD there and I am angry I was not able to do that with my IBFX account. So I am going to see where I want to switch too. I closed my EUR trades a couple of days ago and that was a very good decision. Then I started closing some NZD trades and then some CHF trades and then I said bye bye if this keeps going I will wipe out my account so I closed everything and .................. you got it priced reversed so .......................... then the chf/jpy went suck and ........................ just let me vent for a while.
  • #1,607
  • May 6, 2010 5:44pm May 6, 2010 5:44pm
Quoting nanningbob
I didnt ride the trades out like some of you guys did... just let me vent for a while.
I will respect your wishes and will not post on this subject again. Your anger is understandable, due to the fact that your losses were not due to a mistake on your part or a flaw in the system, but by restrictive daft rules of NFA. You once told me that a hedge FREEZES TIME and I have liberally quoted you in a few places. You are one of the top GURUS of FF. Your guidance, hard work and trading philosophy is a source of inspiration for me and many others. You have my respect, gratitude and best wishes for the future.

kind Regards
  • #1,608
  • May 6, 2010 6:56pm May 6, 2010 6:56pm
I closed all my positions yesterday evening - and im glad I did.

Lost quite a bit of my gains from the previous few weeks, but closing when I did certainly saved me from losing it all!!!

I'm not quick enough or experienced enough to get into markets when they are like this, as Bob said, the trading now is super volatile and crazy...indicators mean nothing until things start to come around...which could be some time by the looks of it.

This is what happens when you have a Credit Crunch, global financial crisis etc, and NOTHING CHANGES. We have systemic problems that can't just be covered up by bailouts and what not - things are going to get worse if other countries collapse...think of bank exposure to sovereign debt.
  • #1,609
  • May 6, 2010 7:21pm May 6, 2010 7:21pm
My opinion is this is just a normal retracement of a market that got a bit ahead of itself. (talking stocks, futures, etc.. which I believe have an impact on currencies and vice versa)

We just had 6-8 weeks (US) of up/up/up and no matter what up where indicators meant very little as well...

I believe in technical analysis, wave patterns, etc...

Things move in certain ways and if you study technical analysis and movement of PA, then you will find that this on a larger time frame is just probably a 50 retrace or maybe even a 23 the way it was moving up/down! I haven't spent the time to care.

It is always some 'big reason' why things have changed, and everything has its reasons. This was scheduled to happen, how big and how long is the only question and before you know it, the market will be raging again full speed ahead with no reason and some other currency will go on a run for no spectacular reason.

From my perspective it is just key to remain balanced, calm with a plan for when it hits the 'fan' that you don't get splattered.

This technique is awesome in my opinion. You plug this in w/ a trending plan and you have a great system all around.

-EDIT (Oh, forgot, I actually had my manual NB 4H system setup improperly and I would be up about 300.00 more through all of this over the last couple days. Not a lot, but not bad!)
We are our own best indicator.
  • #1,610
  • May 7, 2010 3:56am May 7, 2010 3:56am
Hi,

I've been watching several threads in forexfactory forums and here's my first and only contribution.

First of all, congratulations for the thread.

Take it from me:

Use only 2x factor and 200 pips target and lag. With this, yesterday, it was like walk in the park.

Example:

I've an mini account of $2000. My first position size is 0,01 lots and additional trades will be entered using 200 pips interval and multiplied by 2. Target is allways 200 pips.

With this setup, you can manage 6 levels without stress.

I wish you all the best.

Kind Regards.
  • #1,611
  • May 7, 2010 7:42am May 7, 2010 7:42am
Hi Guys,

Question:

When a trade goes bad on say GBPUSD, and it is only 100 pips down, would you then change the template to the 2nd buy/sell, or would you wait till it visually gets to 200 or so and then apply the different template.

Reason is, I went ahead and applied my template when some are down 50 pips for a good night sleep, then it would enter me near there and I now have one bad trade at -150 and one at -50...

Confused.
We are our own best indicator.
  • #1,612
  • May 7, 2010 2:47pm May 7, 2010 2:47pm
Hello Nanningbob.

I really enjoyed reading your thread during the last days.
Your work and the documentation on the system is great.

But let me ask you one question:
Why would you rather hedge a position instead of just closing an order?

If you hedge on the same pair (which I assume this is what you're talking about) you just open a trade against your initial trade.
As an example: If you first did buy 1 lot and the hedge the position with selling a lot, on the bottom line you do nothing - the same as just closing the positions and wait for a chance to reenter.
Also a disadvantage is the spread you need to pay again and maybe interest rates.
I would like to hear your point. Am I missing something?

Greetings.
MikeFT
  • #1,613
  • May 7, 2010 5:38pm May 7, 2010 5:38pm
Quoting MikeFT
Hello Nanningbob.

I really enjoyed reading your thread during the last days.
Your work and the documentation on the system is great.

But let me ask you one question:
Why would you rather hedge a position instead of just closing an order?

If you hedge on the same pair (which I assume this is what you're talking about) you just open a trade against your initial trade.
As an example: If you first did buy 1 lot and the hedge the position with selling a lot, on the bottom line you do nothing - the same as just closing the positions and wait for a...
A hedge is an emergency stop trading. In other words you are caught in a super news story and everything is going against you. You are looking at a large loss and you know it is going to get worse. You have two choices, take a loss that may take you weeks to recover from or you can freeze time where you dont make money and you dont lose money. The news story plays out and then you can go back to regular trading and reduce your debt.

Lets say your DD is at -2000 and a super news story hits that could send you to -5000. Instead of taking a -2000 SL you freeze time with a hedge or you can try to ride out a -5000 DD. With a hedge, two days later you close out your proft trades and subtract the same amount from your DD. then deal with your -2000 DD from a couple of days ago. In other words you only trade the market when it suits you not the other way around. It gets you past the bad trades that are really going bad. You keep the trades that are going good. You caught the wave of the news story and hedge the ones going bad. That is the value of hedging. You trade the market only when it is ranging the way you like.

A managed account I am doing was at -1274 DD on all the trades. I knew news was going to make the market go nuts. So I hedged all the trades. The market could have sent the DD into thousands in the hole but during that whole mess the DD never moved. Now I have -1274 DD which consists of -1704 in losses and +430 in profit. I will look at the trades Monday, the news Monday and see if I want to start trading again or sit on these hedges. I can now wait this entire news story thing out. The guys here know I can handle a -1274 DD pretty easy. I had one inverstor write me and tell me, hey you avoided the blood bath. I know one guy who tried to trade these moves and lost over a 1000 dollars in less than an hour. He was trading fifty cent lots. That is the value of hedging, you make everything equal, walk away and while everyone else is having a heart attack, my blood pressue didnt rise 1 point. I will read the news over the weekend, wait for the monday gaps and then decide whether the market has settled enough for me to trade. If it isnt and the market is going to go nuts again next week. I will sit on my hedges while everyone else is pulling their hair out. At some point the market will return to normal. I will take a couple of trades above below the gold lines and my DD will be gone. That my friend is the value of hedging.
  • #1,614
  • May 7, 2010 5:56pm May 7, 2010 5:56pm
Quoting bluemele
Hi Guys,

Question:

When a trade goes bad on say GBPUSD, and it is only 100 pips down, would you then change the template to the 2nd buy/sell, or would you wait till it visually gets to 200 or so and then apply the different template.

Reason is, I went ahead and applied my template when some are down 50 pips for a good night sleep, then it would enter me near there and I now have one bad trade at -150 and one at -50...

Confused.
You want to try to keep your spacing between 150-200. That may not be always possible but you want to wait on that 2nd template to when you are far enough in the hole to justify it. Again when you are having super news stories like now indicators are worthless, the market is moving too fast for them to tell you it story.

Look at the pic below, the gbp/usd moved around a 1000 pips last week. No indicator told you it was going to do that, no indicator can tell you how far down or how far up it is going to go now. We are way out of normal range. The Brits are having an election in which no one is winning, the pound is in deep DooDoo with debt. You dont know if some bank or company will all of a sudden buy a bunch or GBP to give the currency support or sell off and send it another 1000 pips down. I have closed my trades with IBFX and hedged the other account. I will wait until all the excitement is done before I start trading again. See pic below, I aint trading this kind of stuff guys and gals. This is why I trade the 4H chart, it is telling me something is going wrong right now.
Attached Image (click to enlarge)
Click to Enlarge Name: gbp usd.gif Size: 34 KB
  • #1,615
  • May 7, 2010 6:16pm May 7, 2010 6:16pm
Meanwhile, U.S. investors remained rattled after a session in which the Dow lost almost 1,000 points before rebounding two-thirds of the way back.
"Investors are very confused about how the market could drop hundreds of points in minutes, and until there are concrete answers, they aren't going to feel better," said Andrew Neale, head of wealth management at Fogel Neale Partners.
"The market erased two months of gains in a few days, and it's nerve wracking," he said.



We werent the only ones that suffered the last couple of days. The difference with Forex is we can hedge our trades and sit.
  • #1,616
  • May 8, 2010 2:38am May 8, 2010 2:38am
Quote
That my friend is the value of hedging.

Interesting point. Thanks for the explanation.
I'm glad I don't need to worry about your FAA rules there in the US.
  • #1,617
  • May 8, 2010 3:57am May 8, 2010 3:57am
Even if the indicators say so dont do sells against the USD

NEW YORK, May 7 (Reuters) - Currency speculators increased
bets in favor of the U.S. dollar to the highest since the
launch of the euro in 1999, a currency strategist said on
Friday, citing data from the Commodity Futures Trading
Commission. The value of the dollar's net long position totaled about
$23.3 billion in the week ended May 4, compared with a net long
of $16.24 billion the previous week, according to CFTC and
Reuters data.
  • #1,618
  • May 8, 2010 4:00am May 8, 2010 4:00am
Quoting nanningbob
A hedge is an emergency stop trading. In other words you are caught in a super news story and everything is going against you. You are looking at a large loss and you know it is going to get worse. You have two choices, take a loss that may take you weeks to recover from or you can freeze time where you dont make money and you dont lose money. The news story plays out and then you can go back to regular trading and reduce your debt.

Lets say your DD is at -2000 and a super news story hits that could send you to -5000. Instead of taking a -2000...
I guess the key is in determining when to close the hedged trade. If you don't close it in the area near the turnaround, you get a dangler trade that you're possibly stuck with for awhile, right?
  • #1,619
  • May 8, 2010 5:29am May 8, 2010 5:29am
Hi Bob,

I had always learned as a trader, lose your trade and be done with it.

You have explained hedging well in the sense as if you have no idea on the mid term where things are headed then in the short term you need to protect yourself. Once you have a clear direction, then you are already in and can just ride your winner and cut your loser instead of trying to get back in and 'time' it.

Makes sense and good point.

We are our own best indicator.
  • #1,620
  • May 8, 2010 9:32am May 8, 2010 9:32am
Quoting bluemele
Hi Bob,

I had always learned as a trader, lose your trade and be done with it.

You have explained hedging well in the sense as if you have no idea on the mid term where things are headed then in the short term you need to protect yourself. Once you have a clear direction, then you are already in and can just ride your winner and cut your loser instead of trying to get back in and 'time' it.

Makes sense and good point.

Good way of explaining. I call it a breather, maybe I will write later what to do afterwards. That probably would help some traders with the concept.
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