Auslanco - GBP/JPY and GBP/USD (newstrade)

a small retracement would be in place above 129.36, and it may go as high as 129.95.

Where is the 135 or 137 caller?
over confident is never good.

you never know .

As long as daily still close below these 2 levels. Enjoy the bear show

Scrat, you see. I don't condemn the possibility that 135 or 137 is coming soon, but if they was like " the price is coming now, get ready everyone. Oh god you shorted?? I bless you, i hope you got your target but the price is going 135 now ." Its not respecting other trader as there is intraday trader, scalper at the forum. Also this is the point we argue over time and time. Some ppl jus trade differently and we need to respect that and keep in mind.. don't you think so?

I have to say I agree. No blame here, but the certainty of some calls are somehow embarassing. But once again, one person, one style.

Ok, firstly I assume that you're evenly hedged so that your long position is equivalent to your short. That being said, if it were me I'd give myself two options:

1. You feel confident there will be a retracement to at least the 129.50/60 level and you want to play aggressively. In this situation I would cut my shorts right now and ride my longs up to that area to decrease some of the loss on those. What this does is lock in your short gains and help eliminate some of the loss on your long (note, you will still be taking a loss of about 100 pips on those). Then I would look to re-enter short for the ride down which would make back the loss you took on longs.

Now the danger here is that the retracement doesn't come and we continue lower... then you're stuck with your longs and no hedge. If you plan to take this route you should put a stop loss in to limit your losses.

2. This is the safe play that leaves your hedge on for the time being. You can focus on two levels... a retracement to 129.50/60 or new lows below 129.00 A move to 129.50/60ish (or even higher) would allow you to dump your longs (again, at a loss) and leave yourself with shorts. If you feel confident in the downtrend it would be a good place to add more shorts which again, would help you make back your loss on your longs quicker.

The other scenario with this choice would be if we don't retrace and go for sub 129.00... you could place a stop loss on your longs a bit below that area so they come off, anticipating a further push lower so your shorts begin to work for you and eat away at your realized long loss. A break below 129.00 could be another good place to add some shorts and would only bring your average down a bit from your entry of 129.73... you'd be showing a positive trade which is always nice for your psychology and continue riding the trade down (I see no reason why we shouldn't at the very least test 127.70 if not break it and go for 125).

You probably noticed that both scenarios end with you taking a loss on your longs. That's just the way it has to be in my opinion. When we make mistakes we almost always end up paying for them... it's the price for learning. Let us know what you decide and how things turn out.

Best of luck!

Well written and easily understood!

Thanks a lot for your help! I appreciate the time you took to write down this post!

When this "novel" is finished I will let you know the final result!!

Sounds good bud, best of luck to you... I can promise you nearly everyone here can relate.

if down, 128.20 will be my first TP of 1/4 of my position

yes, of course.

You can also keep your hedge, take profit on the short @ 127.7 and ride the long out till we're back in the low 140ties.
That way both trades end in profit.

That's how I would do it.

That would be a nice scenario assuming that PA gets down to 127.70 AND reverses there. IMHO, the trick with handling the hedge is to time dropping one leg when there is a high probability that PA will continue in the direction of the other leg. Also, it may take some time for PA to get to 127.70 and back to 140ties.

That's right, 127.70 is not sure, 140ties is. It only takes a good supply of patience pills.

Yeah, you're so right - when it comes to hedges, a doc should prescribe double dose of patience pills...

Gotta crack Karmo's copyright coz he's having too much fun with his monopoly abuse

peanut butter trade in ranging market yesterday especially AUDUSD, EY n GY...very predictable

Now look like i falling in love with assuie girl...mmm

Look to diversify my taste not only for my Maria...

good luck guys

g

Patience pills... Did someone ask for patience pills. Karmo is selling them... and they are good. haha

Personally I don't think anyone should mess with hedges unless you're in a profitable trade and it looks like the trend is ending. At this point you can start placing small hedges which locks in profit while still letting the trade run plus you start to build a position for the new trend. To be honest, I don't even like doing this since the hardest part of a trade is the exit and with a hedge you've just doubled the number of exits you have to figure out. Trading is hard enough already, why you want double the work, not to mention locking up more margin. good luck.

Good morning traders(for those of you on GMT -2 line).... Well yesterday price action was classic before a breakout which is, of course, timed for Thursday, a 600 pip average day. So we have all the signs - A compression of moving averages, low daily pip H/L and if you look on the hourly chart in the last 26 hours a formation called "the flag" along with assorted triangles on other TF as well....

Question is what bias is you game-plan created on and why? Some of us all ready have our bias for different TF's. Some of us play by ear and will employ a break out strategy based on today's events.

Well I will try to look at today's possibilities from my viewpoint and just keep it at a summary level First off I would and have taken a look at "price action" historical path on various time-frames. I have looked at PA on the daily, weekly and monthly time-frames. I would look at it from a Fibonacci angle, again based on those three time-frames as well as a wave analysis looking at where momentum intersects.

Since we are playing a cross currency pair which in this case is the "GBPJPY", I would look at the quoted side of the currency pair "JPY" on other currency pairs to see what correlated effects it might have on the pair that I am playing. It could give me some valuable insight on the various time-frames as well as today's events.

Hmmm... if I want to see how far up or down the price-action will go then all I do is look at historical averages based on again "time-frames". There are sites that you can go to look this up both free and paid sites. For example, I can look up daily averages over 1 month, 3 months, 6 months or higher for each day of the week for this currency pair (or any other) to see what is the historical average where this pair can go. "GBPJPY" has an average to move 600 pips based on the last 3 months averages or around 500 pips based on a years data for a Thursday. Also Thursdays is the most active pip day of the week by far again historically. How does that help me? Well we currently have PA at 129.50 so f we use that as the median line then I know that on a bullish breakout I could be looking at 134.5 take-profit area and on a bearish breakout I am looking at 124.50 take-profit. Now those are averages so it could be greater or less then 500 pips...

If your gameplan is based on higher time-frames like weekly charts then most likely your are bias for bear action, which means for today's action I would imagine your are selling the rallies strongly and looking to take profit at the 125 level and by next week shooting for a touch at 122...with the goal of eventually reaching 118. Not a bad plan at all really... Go with the major trends is always a good and less stressful way of making money

Some are playing just the intraday so I would imagine you will be emplying a break-out strategy. There is a nice flag on the hourly charts which I would imagine if price action breaks either support or resistance levels then you would follow. My game-plan, intraday, is to sell if the support on the flag is broken decisively for the 125 level or to buy if the resistance breaks for at least 135 with a follow up on Friday to 137 level...

Either way I love Thursdays as it really helps to pay for my kids schooling... Sorry for the long post just trying to wake up here 5 in the morning with my coffee....

Good luck and and good trading...