It's Really All About Consistency...

Ok, here's my sentiment analysis for the day.... I suggest anyone who is trying to understand how to better trade, that they review it all... but, if someone just wants to see what a summary and conclusion is... just go to the end.

However, Knowing what someone like me looks at to make these determinations is very important...anyone that I believe is seriuos about becoming a successful, discretionary day trader would be wise to review the entire analysis, if for no other reason than to learn one possible way of looking at the markets (one possible way that WORKS, mind you)

THE ANALYSIS:

Seems the biggest news of the day is that another QE is not in the near future. The worse than expected NFP was a big boost to the “more QE” rumors, and as I stated in a previous analysis, this is NOT bullish for risk markets, it is simply bearish for the Dollar (and risk will rise if priced against the dollar). With his statements, it negates the biggest sentiment reason for the rally in the first place, and a move back downward is extremely likely. This is supported now by the recent rally taking pressure off of what could have developed into a full blown short squeeze rally, but the markets are now much less vulnerable to such...at least for now.

Stock markets are heading lower as well, after the rally up to some fairly key areas of willing sellers.

China reduced it’s interest rate, but it is not enough from the “monetary supportive” camp to counteract bernake’s lack of enthusiasm for another near term QE. Also, china is due to report inflation and investment/output figures.... find out if this has come out, and if so, what hte result was. In fact, this seems to “confirm” market fears that the euro debt crisis is causing problems elsewhere...rather than as a sign of positive support for risk markets. China industrial output is seen probably rising 9.8% last month from the previous year...which would be slower than it has in 3 years.

Based on early currency market reactions, the yen seems to be stronger than the dollar as the “risk off” trade currency of preference.,...but watch for BoJ talks of course.... However, Japans GDP grew an annualized 4.7%... this beat preliminary estimates from japan of 4.1%, and the popular economic speculation of 4.5% growth. Japan really is doing quite nicely compared to the rest when viewed in this light.

Asian bond indexes are on the rise since the bernake speech... everything is pointing to risk off today.

It seems many central banks are being watched with an eye towards a more dovish monetary policy as they lower or look to possibly lower rates.

Germany is expected to release export data today, and the rumor is that exports fell in april. This seems to be the “next bad news” that the market is focusing on... however, the REAL driver is the lack of a U.S. QE on the horizon. It is looking like the popular number with economists is that german exports decreased about 0.7% from march.

Also, the AUD fell after data came out showing it posted a trade deficit for a 4th month in a row... this further boosts concerns that the risk off trading environment that has powered the markets since the poor NFP of last week is now at it’s end.

In summary: It seems fear is returning stronly to the markets... Risk off is the theme for the day, and unless I see a strong catalyst or correlated markets somehow rallying strongly today, It will be day I look to get short risk markets, against the usd and jpy. Since the BOJ isn’t meeting now, once the japanese markets and government close down (later in the london session, or during the U.S. session open) I will look to get short risk markets against the yen, should I have a chance to do so around the asian session ranges established today (or higher, if possible)

CONCLUSION: First part of the day, short risk against the USD... latter part of the day, short risk against the USD OR the JPY. This may be the most obvious trade opportunities of the week.

Ok...so with my analysis being done, I'm now gonna put some levels up in some markets that I feel will be solid to take trades from. I'm looking to short eur/usd anywhere from 2535 or higher, my focus being 2540, 2570, and 2610.
I see these as being good technical levels (or very very close to good techinal levels)

In the aussie, I'm less confident of the market selling off today...at least not without a significant pull back. i'm looking around 9910+ to short, but really prefer the 9953-9961 as being idea... or possibly even parity again.

in the eur/jpy, i'm looking atou 100.19+, including 100.20 and 100.50-100.60

the gbp/usd, i like 5530+, focusing on 5533, 5580, and 5600

The geppy i like 123.50+ for shorting, and finally in the usd/jpy this is my least favorite "shortting opportunity", but if i do it, it'll be around 79.50, or better still, 79.70


This is what i'm looking at today, deteremined by various aspects of techincal analysis. Time will tell how it all plays out.

Well... seems the markets might have seen the same things i saw, and didn't take a chance on a possible upward retracement.

If this is the end result, so be it...in this case I will have no trades today.

And, the best thing about this is... I feel really good about that. Not anxious, or frustrated that I somehow "missed the move" or any such other "ABC's of trading psych errors"

On the contrary, I feel fully in control, and very confident in my analysis...as well as very satisfied with my unwillingness to alter or change this to enter a trade any lower than the general zones I'm looking at.

In other words, my mindset and my analysis are on the same page, working in concert, as opposed to pulling against each other.

This is the place where trading success comes from...at least for me. It's nice to have a relatively quick recovery from such distracted, low confident trading as I had experienced earlier this week.

Tonight, win lose or draw, will be a good night.

Hey man...sorry about the slow response. Just haven't taken the time to go through your post and respond, but i'll do so know.

As far as very good trader.... I don't know in all honesty. Depends on one's definition of that.... I would say I am a very good market analyst...and have a great deal of potential to be a GREAT trader...but the possibility and reality at this point in time are not one in the same. It's the head game that has slowed me up lately, and until I get that down better... i'll be able to continue to make a living trading, but will fall so far short of what I believe I could be doing. So... guess we'll have to hold out to see on the "very good" part. but.. "professional" would be more accurate for now.

I'm in my 30's, background is my family runs a business, and I've been around that environment for the most part.

Didn't go to college. Never worked in the trading industry other than as a retail trader. I found forex trading as just another component of the trading universe. I find it suits my personality better than stocks, and I feel i understand the elements that influence it to a greater degree than I do in the stock market, debt markets, and definately more than the futures markets on the whole..

I always had an interest in a leveraged approach to building wealth...however that may be acheived (in a business, in real estate, outside investment to a startup, the markets...etc)

I just happen to like trading a lot.

Hope this answers your questions... feel free to ask anything else. and what exactly does the "buddy list" thing do...does that mean if I show up at your house you have to toss me a beer? New here, and now sure how that works or what it's about.

hope you are learning something from this thread...

X

Hey all... i've had some ask me questions about more mechanical aspects of analysis, particularly technical analysis. I have started a blog geared more to "teach"... here is a link. I will flesh it out a great deal more as time goes on, and I will only make posts with information I have found myself to provide a real edge in the markets, or relevent to success. No "fluff" here.

Here's the link:

http://currencytraderx.wordpress.com/

Good stuff man!

Hey, Golferguy.... wanted to direct this at you... your whole "2 trades a day" thing I think is going to be a very effective rule to help me whenever I have a losing day....

I may do a more extensive writeup about it later, but for now, I think it's the perfect "plan b" to move into on any day following a losing trading session for me.

3 is too many, I instinctively feel more freedom, less structure, and less NEED to be as prudent as possible if I believe I have 3 possible trades to take.

1 isn't enough. I need a chance to make a profit should the first trade not work out... i can see myself spending day after day either not taking a trade, or losing because that one specific level didn't hold.

Also, 1 trade doesn't allow my mind to experience any sort of "corrective action" while the memory of a loss is fresh in my mind. The next day is too late for this.

SO, thanks a lot. I think this was really a very insightful approach for your mentor to take, and i have written it in to use as one of the basic building blocks of my trading plan with regards to how I trade after experiencing a loss.

For anyone struggling with trading emotionally after a losing day... this might be worth considering for you as well.

X

Thanks! Really glad to see some of the more experienced traders are finding this thread to hold some interest.

There is something about positive re-enforcement from one's peers that has a bit of a stress relieving effect during moments of self doubt.

Not that it makes any difference whatsoever in the end.... as I got where I am without any such support (my family thought I was kinda crazy for a while... and others didn't even know what I did)... but, it's nice nevertheless.

Feel free to post any suggestions or questions or comments also... I may not answer right away, but I will answer and appreciate all suggestions/alternative outlooks.

X

well, there's 2440..the level i was thinking would be the bounce point of the day... looks now like we may se lower lows...but... i still think it's a viable bounce point.

Not taking it....though I have taken 1 of my 2 trades in the AUD... it seems the strongest of risk markets, and after such a selloff, I doubt I'll get a move up to where I would like to short.

So, mayb ejust the 1 trade, a small long in aud/usd. At any rate, time will tell how it plays out. I'll be looking to reduce risk rather aggressively on this if it doesn't look right, because as much as I believe a risk bounce is in order here, I just have greater conviction regarding shorting risk markets today.

ANyway... back to the charts, lets see how it goes

X,
Ive just done something ive never done before. Read someones personal thread from start to finish.
I was engaged the whole time with your thoughts and developments.
I really admire your desire and committment.

Im new to trading as such and very new to Forex. Just like you, what I like about Forex trading as opposed to Equities (Value Investing) is making sense of fundamental data seems to be a little easier and data more reliable.

Ive subscribed to your thread and look forward to your future posts.

forextraderx,

Glad that I could be of help in someway. Keep it up!

PIP'N!!

Well... although it was a lot of sitting for not a lot of shorting... I DID get one opportunity for a trade. I went long the market that I felt had the best technical, sentiment, and fundamental reasons to bounce.... and ended up taking an AUD/USD long trade around 9839.

Entry wasn't bad, since from the moment i got it, it never moved even 10 pips against me... and is now up 33 pips (for the portion I still have on. Not liking long any risk today, I moved quick to reduce risk and create a trade that can't hurt my balance in any way)

The low of the day was about 18 pips from my entry. Here's a link to see how the entry and final exit worked out on a chart:

http://www.forexfactory.com/showthre...trade957280535

Over all, I feel great about today. I didn't even take the 2 trades, because the opportunities I wanted just didn't set up, and that's ok.

by waiting for them, I was forced to pass a lot of sub par setups, and in fact, only went long when I realized there was a great deal of information supporting a long move for at least a 20-30 pip bounce, and that it would likely be the only trade I get for the day.

Just the waiting alone for the best setups helped me keep a clear head late into the session, so when a good trade that DID set up, I was able to see it for what it was, handle it appropriately, and make a little extra money on an otherwise slow week.

What a great result!

I think this 2 trades a day after losing is a shit hot idea.... and in fact, may even impliment a mandatory "day off" after a losing day, and THEN the 2 trades for 3 consecutive winning days.

Not sure exactly right now...i'll just see how it unfolds organically. But, this is absolutely better than it ever has been before. I was able to see a potentially dangerous set of behaviors and attitudes cloud my judgement, and then I was able to stop almost immediately, step back, recognize what was wrong, and act in some way that I felt would help correct it.

And...so far...it did. This is the fastest recovery time that I can remember for me, regarding starting to fall "offtrack", and then being able to collect myself, and get back "on track" and make the best decisions, day in and day out

Solid.

More later as it is relevent or comes to mind... for now i'm glad to hear from those of you who are getting something out of this (or even actually liking to read along! lol)

This "comeback" of sorts has been a major victory for me on a personal level. But it's a far cry from a "habit that demonstrates mastery" I'll keep this up, and hopefully over the course of this year, it does become just that.

Here it is...my aud/usd long. no more than a 9 pip drawdown from entry, and 18 pips off the Low of the day. not too bad all things considered:

Entry just below 9840, targeting 9900 Stop just above BE now

well.... today was one trade taken, a long on aud/usd.

if it hits it's target, it'll have made about 0.5% profit...if it stops, i'll have made about 0.20%...give or take.

This will put me up about 1% -1.3% for the week (depending on a stop out or a target for this last position)

Today felt exactly how it SHOULD feel to be trading well. And the results, while limited today...seemed to show that.

Looking forward to this coming week... it may be a very good one

Well, looks like i'm up about 13% in 3 weeks here, and my largest drawdown has been under 2% so far...

This is good of course, but I'm actually a bit ecstatic about how I was able to so quickly recognize when I wasn't trading well at all, and then, to fix it almost equally as quickly.

This is actually "brand new" for me... it's the first time i've been able to catch and fix such an issue so quickly.

This is actually the reason why I started this whole thing of course... to learn how get myself back in top form when my trading starts to slip...and I think I can summarize it in a few bullet points.

1. having a structured routine each day that determines the opportunties I see organically, rather than mechanically.

2. when a losing day occurs, SIMPLIFY! By reducing total trades able to be taken down to just 2 trades, and therefore limiting the total number of markets to watch down to at MOST 2 markets.... it greatly enhances my own confidence in finding a good setup, as I have really nothing to distract from finding the best possible opportunity, and ignoring the rest.

3. by going through every single step in my routine, I naturally find confidence in what I see is a potential opportunity because I feel i've looked at it through many different viewpoints, and they pretty much all agree that this is the best opportunity of the day/week/whatever.

4. by focusing down on just the best, and limiting this to eliminate distractions, stimuli, and therefore confusion... and doing this for 3 days consecutively when I experience a loss, It gives me very simple, very effective ways to channel my knowledge and come to a single clear decision on what is the best opportunity or 2 for that day. This breeds success, and 3 consecutive days of this is excellent to start a "positive feedback loop" to maintain success as I expand back into more markets, and look to take more opportunities.

It really comes down to two things:

1. limit actions therefore limiting damage when my trading is "off"..

2. by limiting actions I limit choices, and therefore items of consideration...and therefore reduce confusion. This essentially acts to "simplify" my trading, without sacrificing any of the many important elements I feel are necessary to get a very complete, accurate view of the markets.

It's not about simplifying the process...it's about simplifiying the amount of markets I apply that process toward...and this really helps clarify things.

Great...great insight here for me. Something totally new believe it or not, and something I believe I can build upon and re-enforce now that I know the importance and exact way in which to "simplify" my trading when I start to get confused.

I find when i have clarity, I can dynamically identify great trades in nearly all markets, as they appear, or as they are affected by other markets, events, etc.

but, after a loss...i am greatly limited in this ability. I still have all the tools...but I lose the ability to do it on so many different levels at one time. This revelation is new...and I think will have a profound impact on my ability to get "back in form" when I start to underperform.

It kinda feels like Christmas came early or something.... I am looking forward to further improving my trading, and identifying other leaks...but this is the first TRUE insight since starting this project...and from where I'm standing now, I don't know if any could be more important.

Well done, a very interesting and beneficial journal. i will keep reading and follow this journal. I might lost my job by the end of this year, with 2 children it is hard if i did not learn something for my back up plan. I will get a new job but this forex will be my side income plan, not too much just to make some money for daily car fuel and others expenses.

Guys...here's a quick list I put together of what I find important to know in order to trade well, day in, day out. I wrote it up on my blog... if your not yet profitable, check this out, and maybe it'll give you some points to act on or even just some perspective:

http://currencytraderx.wordpress.com...needs-to-know/

Again, i'll be putting together a more educationally geared blog, one post at a time. here is a post I think most of you will appreciate...it's a very simple, very high probability pattern called a flag base, or a spike base.

It's something I look for every single day, and trade every week as a "foundational" pattern of my technical analysis methodology. it works.

it's takes some practice to understand and recognize...but it is really pretty easy, and I would say easily has a win rate over 60%

here's a link: http://currencytraderx.wordpress.com...he-spike-base/

Glad you found your way here, and sorry to hear about your situation. I will warn you however, I would plan on spending 2 years minimum to learn how to trade...and another 1 year to get comfortable enough doing it to be able to pull out a profit on a regular basis.

Even for a very simple approach, there is a great deal to learn... so think of this as a future business, or retirement plan...not so much as your next job. That would be my advice.

As far as make some money for daily fuel and other expenses.... if you can make $50 a month, it is just as easy to make $50,000 a month.

Problem is, just being able to make $50 is very very difficult for most...at least for the first year or two.

Thanks again tho... you might want to check out my blog, it is more educationally geared.

X

I have posted this up on my blog, and I here is a link for those who might be interested...I don't believe I posted it here yet, but I've gotten some great feedback about it, so i wanted to share with others:

http://www.forexfactory.com/showthre...92#post5722692

It's really a 4 step process on how to really implement sentiment analysis as a viable and somewhat structured form of analysis to your trading toolbelt.