Starting with $50

So, using diagonal lines, I do things different. I don't use the wicks of the candles but the body. The first chart above shows the problem...the angle caused by the first 3 candles actually creates confusion by not allowing the trader to make an informed decision. One down candle could've been a trade in the wrong direction.

Once confusion has been established in the trader it is just like being in a fight where you lose your balance.

Now lets' go to Bollinger Bands.

I only use Bollinger Bands for one thing. To determine overbought/sold conditions. They confirm the Stochastics. Nothing fancy here, just use the default settings. The problem with Bollinger Bands and Stochastics is that both can stay in an overbought/sold condition for an extended period of time

Once I see what is happening I take them off.

I can hear it now..."if you're so smart how why do you have bad trades sometimes?" Simple...I deviate from my own method. I will read a thread and try a new method, incorporating something and WHAM! I lose.

This is the last indicator I use. This indicator will tell you if you are in a good trade or if you need to exit immediately. I ONLY apply it to a closed candle. If you monitor this too closely and enter/exit based on an active candle...WHAM! You will lose...experience talking.

Only apply this on CLOSED candles.

This last indicator is the 8 moving average. You can use either an EMA (exponential) or SMA (simple), doesn't matter. This one little indicator will cause your trades to succeed tremendously...but only apply it to the 1 hour chart. That part is very important!!!

Last night I could've sold at a much higher price but was not confident that this market is bullish enough to jump...but it did.

In this 1 hour chart from last night I will show you a complete worksheet, minus the Fibonacci's. You will see:

1. 21,5,5 Stocahstics

2. Bollinger Bands

3. Short term diagonal line

4. Intermediate term diagonal line (less than 2 weeks old)

5. 8 sma

The second chart will show where I should have exited...when I lack confidence I lose out on profits. It shows a diagonal line (using closed candles as connecting points) connecting 2 recent high points and notice it hit PRECISELY the projected point.

I think I'll start doing this so I can document where my head was when I made a decision and how I came up with that thought process.

This chart is a 1 hr chart with the following indicators:

1. vertical line (in red to show when I came up with my thoughts earlier today)

2. intermediate term diagonal lines (upper in aqua, lower in navy blue)

3. short term diagonal lines (in aqua)

4. Bollinger Bands

5. FiboPiv

6. 5,5,5 and 21,5,5 Stochastics

7. 8 sma (in yellow)

What's happening RIGHT NOW on the chart:

A person can make the case that the trend is over or it will continue based on everything below. I looked at my 4 hr chart and it shows the 5,5,5 Stochastics in overbought territory...should tank tonight.

1. the upper Bollinger band was breached on the last candle

2. the 21,5,5 Stochastics is showing overbought and declining

3. the diagonal trendline (solid aqua) shows trend is soon to be over

4. the 8 sma is showing the price will continue upwards but it just takes ONE single candle to close below the 8 sma and we have a new trend, a declining trend to short.

Earlier today I drew an upper diagonal trendline (the dotted line in aqua) from previous highs and they almost nailed it, off by just a little. I then drew a lower trendline from previous lows and projected where it goes tonight...should be just below the Support 2 level of the FiboPiv.

Remember, I use trendlines drawn off of the body not the wick. See if you can see what I see...

As my little cheat sheet worksheet showed a few minutes ago, I'm bearish tonight.

The 4 hr chart 5,5,5 Stochastics is perfectly overbought and so is the 1 hr charts 21,5,5 Stochastics.

On the 1 hr chart, the price is below the 8 sma, the short term trendline has been broken, the upper Bollinger band had been breached...plenty of confirmations to make a decision to go short.

Now let's see if I can get the exit right. Exit is based off a trendline (in orange) and I used the closed candles low of Sept 30th, backing it off a bit from the trendline to give me plenty of wiggle room. Just midway between the Support 1 and Support 2 of the FiboPiv indicator. This is a big drop so let's see if it happens. If not, we can all laugh about it in the morning.


Pending Sell Stop

Entry = 1.28750...Exit = 1.28080


Here's the charts...4 hr then 1 hr.

And laugh we will. Reminds me of a song by Three Dog Night called Never Been to Spain.

Trade canceled.

Momo went bullish on Spain rumors...cool with me since my trade didn't get triggered.

Here's what happened:

In the chart below I drew mid-term trendlines to give direction of my trade...my interpretation was incorrect. My notes show the line I drew incorrectly (navy blue) and the correct line that I should've traded (pink).

Pretty straight forward.


Pending Buy Stop


Entry = 1.29200...exit = 1.29524

I deviated and went against the 4 hr trend. Was up with a nice profit for a little while...but when you deviate, you lose. I managed to turn a $4+ loss into a small gain after it was all said and done.

I hate to say it but trading one pair is soooo boring. I am considering trading other pairs just to get this moving along.

WTH, I'm a trader that feels like a traitor. I'm not gonna be true to my own method of trading for a short period of time because of another thread I read. Here it is...

http://www.forexfactory.com/showthread.php?t=386456

This is a system by tmoney and it is pretty impressive to say the least in that it removes a crucial amount of 'guesswork' from the equation...and that is what every trader wants, a more reliable method of making pips.

Stochastics are excellent and I will incorporate them in this first trade to see the difference and/or see if the assist in my decision making process. A tool is beneficial or it's just extra weight.

This is the trade I just ordered right in the middle of the day, 1:15pm mst:


Pending Buy Stop...currency = NZDJPY

Entry = 64.500...exit = 65.150


In fairness to tmoney's system, I did NOT do it correctly as I put in my order too early. I thought it would not trigger until the 2:00 (next 4 hr candle) but I was wrong...it already triggered. Shame on me.

Well, I'm in and now we wait.

Gotta say well done to you so far ocd. I've lurked around these forums for a long while now and yours is one of the only threads I've discovered where you show the system, the trades AND the trade explorer is pip positive.
Still following to see how far you can take this. Think the thread will become a must read for traders.

Hi Ocd

Changing methods haha, I thought you were already onto something. I like the look of your EURUSD pending order. What is your TP on this trade?

Personally I can't see what you see on the NZDJPY trade but I hope it works out for ya.

Keep up the good work.

Thanks Trading Drunk and Fuse. Those are two great trading names.

I can't believe I didn't even put the EURUSD trade on here...sorry about that.


It WAS a pending Sell Stop order

Entry = 1.29990...exit = 1.29500


I may run into trouble I didn't think about by being in 2 trades using .02 lot size on each trade. If either trade pulls back much it probably will cancel the trade with a margin call.

I just closed my trade on the EURUSD because I can't tell which way it's gonna go. That stinkin payroll report is gonna come out in a little bit and it could go either way...to risky for me so I took a small loss on the trade.

Very positive feedback for all

The 2 trades I was in last night tell a story of every successful and failed trader...trading in the right direction and the wrong direction. I can put my finger on the majority of my failed trades...the reason why.

My trading method is supposed to make it easy for a person to get in the right side of a trade, watch it go in that direction and exit at predetermined price using Stochastics and two timeframes. The problem is that sometimes the Stochastics acts as a CONTINUATION indicator rather than a REVERSAL indicator.

Okay, fine. But how can you tell the difference? With my method you can't...and that creates failed trades. And plenty of frustration!!!

About last night's trades:

EURUSD (using my method of Stochastics only)...4.1 pip loss and would've been way more had I not exited when I did. It was primed for a reversal but ended up being a continuation.

NZDJPY (using tmoney's method plus Stochastics)...45 pip gain and would've been 50 had I used a vertical trendline.

I will explain the details of how I will be trading in the next post. I predict I will have less trades per week but much more success...we will see in the coming weeks.

Here's the thread where the light bulb went on for me...

http://www.forexfactory.com/showthread.php?t=386456

Well here we go again!

Tonight's trade will be based off the pair NZDJPY and we're going long!


Entry = 64.450...exit = 64.950...and something NEW Stop Loss = 64.140

The trade was based off of tmoney's criteria for determining the trend (of the daily and 4 hr) going in the same direction. Entry was based off of his criteria as mentioned earlier in the 'Channel Surfing' thread.

Notice in the first chart (4 hr chart) that both channels are lining up and going in the same direction. Hopefully, we'll see some solid upward movement soon but the Stop Loss is in place just in case.

The 1 hr chart shows Stochastics in an upward movement from oversold condition.

That certainly was a bust!

Stop loss hit...2 things to take away from this trade:

1. if Stochastics tell you this is the wrong time to buy, it probably is.

2. Stop Loss sucks. When you buy right you don't need them.

I bought wrong and the milk man can tell you that just by looking at the 4 hr chart above...notice the 5,5,5 Stochastics? It's going down clear as day and I went long...

It's gonna be a good call but not right now, maybe in 3 to 4 hrs from now.

Here's the pairs that I'll be watching because they are getting ready to pop tonight based on Stochastics of 4 hr and 1 hr charts:


1. nzdusd...long

2. gbpjpy...long RIGHT NOW

3. nzdjpy...long and that will be a nice pop tonight...hammer forming right now on 4 hr chart

4. eurcad...long but let's see how that one plays out because it has to fall a little more before it reverses.

Hello!, if you only trading with 50US$ starting capital, why dont you open a live account????

If you trade a live account would you show the public your personal figures? I know I won't.

People have to be able to see the figures, either good or bad, and the demo account allows me to do just that.

Okay, so I was stopped out a few hours ago. We will try it again. This time I will be more cautious about the trade itself.


Pending Buy Stop

Pair: NZDUSD

Going LONG

Entry = .81850...exit = .82350

No Stop Loss this time



Why am I taking this trade?

The 4 hr chart shows two positive reasons. The first is that the daily channel indicator and the 4 hr channel indicator have lined up in a bullish direction. The second reason is that the 5,5,5 Stochastics is oversold and turning.

We are in the Demand zone.

The 1 hr chart shows the 21,5,5 Stochastics in the oversold condition...kind of lingering but should turn (because the 4 hr channels are both bullish).

Please disregard the channels on the 1 hr chart, I did not delete them for the picture...right now I only use them on the 4 hr chart.