Slow and steady

Update on the chfjpy trade...


Considering moving stops to breakeven, but not quite yet....

My very basic take on things...(part I)

1. The market moves simply by virtue of there being more buyers than sellers or vice versa
2. Buyers and sellers are all people, hence the market is not a 'live' thing. It is simply a representation of what the people believe or are doing out there.
3. People all want to make money out of this market, so use whatever information they can to do so - fundamentals and technical analysis
4. A fancy schmancy indicator used by 4 people in the world is hardly picking up on what the other millions out there are basing their trades on, unless of course it picks up or is a derivative of sorts on some related rule/methodology that the masses out there use.
5. All major reports and charts seem to use trendlines and fibs. Look at the chart below. Why oh why did it turn around on that trend line (blue rectangle). I believe its because a very big part of the market had that trendline on their screens, and stopped selling as it got there, and started buying more and more as it 'seemed to bounce' off it.
6. If you use what many out there are using, you'll increase your probability of going the same way that the market goes.

Using 4hour charts one cancels out much of the noise, and also the big players I reckon use longer time frames, and weight their trendlines (i.e. the t/l of the longer time frames) far heavier than those on a 5 min chart.

Please note: I am not saying that trading on a 5 min chart cannot work or is wrong. Its wrong for me, and I justify my position or strategy on the above presumptions. I think there must be countless ways to make money from the market, I am simply sharing my way. :-)

Won't be trading this...

Longer term 4hour trendline (thin blue line) broken.
Coming back to potentially bounce off the above, and again on the upgoing 4 hour countertrend line (thick blue line).

But thick red line is strong daily trend (down), and fibs don't line up so well with the combined area of support.

One to maybe watch.

Daily of audusd...

chfjpy update...

Another great chart showing the price miraculously bouncing off a resistance level...

chfjpy - with the NFP coming out later, I've moved stop to breakeven. Its become a zero risk trade now...

Dieting and trading have huge similarities.

Only real rule for losing weight....eat less (and exercise more). BUT how many billions are spend every year by folks to find some magic silver bullet to lose weight. Milkshakes and pills and exercise machines and and and.....and every year these same people try different new ways. Spending 100's of dollars every time. All they need to do, is eat less. All they need is discipline.

Only real rule for succesful trading...follow your plan (which requires good MM etc). BUT how many folks keep on looking for "the" ultimate system, indicator, mentor, signals, time frame and and and. All they need to do is follow a plan. All they need is discipline.

Now sure there are some caveats, but more often than not, the above holds true...

And again, I'm not nailing indicators, signals, mentors. Sure some are helpful, but with the best systems, signals etc, without discipline, failure is almost guaranteed.

Very exciting this NFP thing, but it seriously increases risk (as it does reward I suppose).

But again, for me to be sustainable in the long run, I prefer to stay out when very big moves (due to very big forex news) are expected - unless I have stops at breakeven of course.

If I do get a little nuts and simply cannot bear to see the market move 100's of pips without me being in it, I trade with very very low lot size. Really just for fun, cause then after all it really just gambling? Not going down the gambling vs trading route, except to say that trading can be gambling if done in a certain reckless, unplanned, "exciting" way.

chfjpy update.


Move stop to 10 above open. Blue line = open, Orange = stop, Green = Limit.
Enough breathing room, but at least locks in some profit if the market tanks.

I have a rule to close all dollar-sensitive positions before NFP, regardless if they are losers or winners. Been burned too many times by NFP.

-soso

what about putting a stop in for a way winning trade...or do you worry about the supposed guaranteed stops?

I should write a program that locks my accounts for 30 min before till 30min after big news !!

Hiya Mosaic,

Interesting thread. Thanks for sharing your trading ideas.

I work off both the 4 hours and shorter timescales.

You posted a 4 hour chart yesterday for GBP/AUD which highlighted how the GBP bounced off it's support.

I'm wondering how you're playing this one as the pair is now at the same levels as 22/5 where it struggled. Personally I enjoyed the ride up and once today is out of the way I'm expecting slowish a drop and will enter once the dust has settled from today's news. Aiming for 2.47ish with at stop at 2.6

I'd be interested to hear your thoughts.

Too many times right at NFP is spiked then it returned the other way...bad bad...

Oh oh, not today, this looks like a clear spike up, the NFP data was way too bad, only +75K.

-soso

Hi HTP,

Thanks...at least someone's reading this !!

Not sure I'm qualified to be giving advice...but I'll give my 2cents worth nonetheless.

If I understand you correctly, you want to go short gbpaud once market calms down after NFP. So maybe at 2.5100 (blue line) Limit at 2.4700 and stop at 2.6000 (red line).

Logic for the trade would be return to trend line. Bounce off of previous level of about 2.500 and also 2.5000 is a nice round number, which often creates levels of resistance/support.

I am not one to have definitive risk reward ratios...it all depends. But to risk 1000 pips for 400. Bit rich for my blood. Also I feel I would be picking a high having nothing to support it except the latter 2 reasons given above which I don't feel are that strong. I will probably wait till it gets back down to the trend line at about 2.47, start going back up and go long...so hopefully will be opening my long as you close your short for 400 pips !! (BIG triangle).

Certainly wouldn't short until I saw an obvious turn down below 2.5000.

Good luck.

Cheers

Hi there...stopped out for 10 pips profit...very much sideways movement up to now...so don't feel to bad about raising the stop and the trade being closed. Next week will have more opportunities.

Have a great weekend everyone.

New week.

Hi there...

Having a look at gbp/jpy...

price getting squashed between 211 resistance and rising green trendline. Something's bound to happen.

Also have a look at the nice bounce off the 61% fib and green trendline.

Keep watching this space !!

Gold...

Trendline bounce and 50 or 61% fib bounce coming up...maybe. If it bounces. I'll be shorting the metal.

Update on Friday's closed trade.

One thing that galls me about 'predictions' or trade decisions taken, is that when they are right, all focus is placed on them, but all the many that are wrong are siphoned away to neverland, as though they were never made.

So in memory of my closed chfjpy trade of last week...here's why I should have stuck to my original plan !!!

It kept climbing. Target hit beautifully (green line).

When using 4 hour charts, one can become hasty and expect movement suddenly like on smaller timeframes, but here the bounced really has seemed to work.

Ok...I feel gold is behaving...am shorting as per the 1 hour chart.

blue = open,
red= stop,
green = target