Low Risk, High Reward Trading Experiment

Hope this helps.

12:49 GMT June 6] [USD/CHF] Offers might emerge at 1.2160--a touted resistance level

11:08 GMT June 6] Offers in [USD/CHF] now seen 1.2120 and again up at 1.2140/50

07:35 GMT June 6] [USD/CHF] Bids 1.2040/50 with support still tipped trailing back from 1.2015 to 1.2000

09:18 GMT June 6] [GBP/USD] Bids are tipped at 1.8690 (approximate Asian session base). Further demand might emerge at 1.8670/80 (cable was trading near 1.8670 into Friday"s disappointing May NFP number). Some stops are touted below 1.8650

07:34 GMT June 6] [GBP/USD] Offers are touted at 1.8800

12:45 GMT June 6] [USD/JPY] Sell interest is tipped at 112.85

09:28 GMT June 6] [USD/JPY] Offers are noted at 112.50, 112.70/80 and into 113.00. Bids are seen at 112.00 ahead of stops just below 112.00. Further bids are reported from 111.75 down to 111.50 from option accounts

04:16 GMT June 6th] [USD/JPY] heavy from 112.50, heavier the closer to 113.00 on option-related and Japanese exporter offers

Sorry ITME, didn't mean to interrupt your thread. The last post was just a reminder that we need to do our own research and not count on your recommendations only. I hope you don't take offend to the post.

Roger

First of all, thanks for all the help anyone can offer.

Monday 6/5/2006 10:30 ET

TS#84E -

Sell USD/JPY immediately - at market price approx. 113.16 - 113.30

Stop is 113.45

Target is 110.40

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Previous trade signals:


Monday 6/5/2006 21:30 ET
TS#84D Sell USD/JPY at market price of 112.35 to 112.50
We were stopped out on this trade by 11 pips. On further study, the market fulfilled one of the characteristic behaviours we have often observed to the pip, which we shall try to remember to expect in the future. In the meantime, in the experiment we must re-enter this short trade at market price of about 112.35 to 112.50
Stop this time is 112.56
Target is still 110.30
Risk is max. 25 pips
Reward is min. 201 pips
Reward : Risk ratio is min. 8.0 to 1
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Monday 6/5/2006 17:10 ET
TS#84C Sell USD/JPY at market price of 112.20 to 112.30
Stop is 112.36
Target is 110.30
Risk is max. 20 pips
Reward is min. 186 pips
Reward : Risk ratio is min. 9.3 to 1

For research purposes only.

Monday 6/5/2006 11:15 ET

TS#85D USD/CHF

Our overall interpretation of the market situation was incorrect earlier, resulting in our being stopped out again. (This seems to be a regular pattern with USD/CHF)

USD/CHF is likely to come up one more time before descending strongly

TS#85D - go short at higher price of about 1.2160 to 1.2180

Stop is 1.2205

Target #1 is 1.1975

Target #2 is 1.1890

Reward T#1 is min. 185 pips
Reward T#2 is min. 265 pips

Risk is max 50 pips

Reward : Risk ratio T#1 is min. 3.7
Reward : Risk ratio T#2 is min. 5.3

Reliability : good

__________________________________________________________

Previous trade signals:

Monday 6/5/2006 17:30 ET
For those not already doing so, go short USD/CHF TS#85C at market price of about 1.2070 to 1.2080
Stop is 1.2093
Target is 119.00
Risk is max. 28 pips
Reward is min. 165 pips
Reward :Risk ratio is min. 5.9 to 1
______________________________________________

Previous trade signal:
Thursday 6/1/2006 9:45 ET
TS#85B Re-enter USD/CHF short at opportune time
Our short trade in USD/CHF was stopped out, and has reached a high of 1.2291. This is probably the ultimate high of this trend, though it may come up one more time to form a double top. In case it never reaches this higherprice again,
Sell USD/CHF at market price of approx. 1.2270 to 1.2280 or higher
Stop is 1.2309
Risk is max. 43 pips
Target #1 is 1.2110
Target #2 is 1.2085
Target # 3 is 1.1945
Reward for Target #3 is min. 321 pips
Reward : Risk ratio is 7.5 to 1

Monday 6/5/2006 12:00 ET

We failed to analyse this trade properly, and came up with a premature entry signal. We thought that it was a retracement on the previous downtrend, when in fact it was a Wave C upwards wave of a downwards ABC with an upwards slope completing an upwards correction on a five month downtrend.

The bad news, is that we were stopped out again. The good news is that USD/JPY has now initiated a downtrend which should be long and strong.

The other bad news is that it is difficult to know how to enter this trend now that it is underway, having travelled about 30 pips already. We were too busy with USD/CHF to issue a signal at the proper time for this currency pair.

Either wait for a correction upwards, which may or may not happen, which could take the price up to a second high of about 113.50 -113.60, or enter at the current price of about 113.25 - 113.30.

TS#84F - Sell USD/JPY at market price approx. 113.25 - 113.60

Stop is 113.88

Target is 110.40

Risk is max. 67 pips at 113.25 entry price
Risk is max. 32 pips at 113.60 entry price

Reward is min. 281 pips at 113.25 entry price
Reward is min. 316 pips at 113.60 entry price

Reward : Risk ratio is 4.2 to 1 at 113.25 entry price
Reward : Risk ratio is 9.9 to 1 at 113.60 entry price

____________________________________

Previous trade signals:

Monday 6/5/2006 10:30 ET
TS#84E - Sell USD/JPY immediately - at market price approx. 113.16 - 113.30
Stop is 113.45 ; Target is 110.40

______________________________

Monday 6/5/2006 21:30 ET
TS#84D Sell USD/JPY at market price of 112.35 to 112.50
We were stopped out on this trade by 11 pips. On further study, the market fulfilled one of the characteristic behaviours we have often observed to the pip, which we shall try to remember to expect in the future. In the meantime, in the experiment we must re-enter this short trade at market price of about 112.35 to 112.50
Stop this time is 112.56
Target is still 110.30
Risk is max. 25 pips
Reward is min. 201 pips ; Reward : Risk ratio is min. 8.0 to 1
_________________________________________________

Monday 6/5/2006 17:10 ET
TS#84C Sell USD/JPY at market price of 112.20 to 112.30
Stop is 112.36
Target is 110.30
Risk is max. 20 pips ; Reward is min. 186 pips
Reward : Risk ratio is min. 9.3 to 1

For research purposes only.

Monday 6/5/2006 13:00 ET

TS#83D Sell USD/CAD at market price of 1.1150 - 1.1160

The remarks concerning the misinterpretation of the uptrend significance made above regarding USD/JPY also apply to USD/CAD and USD/CHF. We thought this uptrend was a retracement on the previous downtrend, when in fact it was a Wave C of an ABC Wave 4 Elliott Wave correction of the larger downtrend.

We should have issued a sell signal at 1.1160 - 1.1175 according to our model, but we were pre-occupied. However, an entry at the current market price of about 1.1150 - 1.1160 is almost as good, with the added advantage of more confidence that the trend is expired.

Stop is 1.1182

Target #1 is 1.0915
Target #2 is 1.0775

Reward #1 is 235 pips
Reward #2 is 375 pips

Risk is max. 36 pips

Reward : Risk ratio T#1 is 6.5 to 1
Reward : Risk ratio T#2 is 10.4 to 1

____________________________________________________________

Previous signals:

TS#83C Sell USD/CAD at market price of 1.1070 - 1.1080
Monday 6/5/2006 17:10 ET
TS#83C Sell USD/CAD at market price of 1.1070 - 1.1080
Stop is 1.1094
Target is 1.0900
Risk is max. 29 pips
Reward is min. 265 pips
Reward : Risk is min. 9.1 to 1
______________________________________

TS#83B Sell USD/CAD at market price of 1.1015 - 1.1025
Monday 6/5/2006 8:30 ET
TS#83B Sell USD/CAD at market price of 1.1015 - 1.1025
Re-entry opportunity for those not already holding a short USD/CAD trade targeting 1.0875
Stop is 1.1057
Target is 1.0875
Reward is min. 135 pips
Risk is max. 52 pips
Reward : Risk ration is 2.6 to 1

Tuesday 6/6/2006 14:00 ET

TS#87B - Buy GBP/USD at market price of 1.8600 to 1.8610

We were too eager to go long on GBP/USD, and as explained above we mis-interpreted the Wave C of the ABC downtrend as a correction of the previous uptrend. Now that the ABC is substantially completed we are close to the end of the Wave 4 correction and almost ready for the larger uptrend to resume.

GBP/USD could go down one more time before it reverses, or it could carry on upwards. The safest strategy is to wait and enter a long trade at 185.87 with a stop at 185.68. But this lower entry price may not be reached. The alternative is to enter now at 1.8600 - 1.8610 and place your stop at 1.8568 also. In this case the reward : risk ratio is lower, but the probability of catching the uptrend at this near bottom is greater.

Entry price is 1.8600 - 1.8610

Stop is 1.8568

Target is 1.8906

Risk is max. 46 pips

Reward is min. 292 pips

Reward : Risk ratio is min. 6.3 to 1

________________________________________--

Previous trade signals:

TS#87A - Buy GBP/USD at market price of 1.8690 to 1.8700
Monday 6/5/2006 21:15 ET
Stop was too close on TS #87. We were stopped out by 4 pips only. Therefore we must re-enter.
Stop is 1.8668 ; Target is 1.8906
Reward is min. 201 pips ; Risk is max. 36 pips
Reward : Risk ratio is min. 5.6 to 1
___________________________________

Monday 6/5/2006 17:20 ET
TS#87 Buy GBP/USD at market price of 1.8700 to 1.8725
Stop is 1.8694 ; Target is 1.8906
Risk is max. 35 pips ; Reward is min. 182 pips
Reward : Risk ratio is 5.3 to 1

For research purposes only.

Tuesday 6/6/2006 17:20 ET

If not already in this trade, or wanting to increase one's position, the double bottom at 1.8589 is a first class low risk, high reward trade opportunity right now.

Stop need only be ten pips lower, at 1.8579

Target is as above, at 1.8906

Risk is only 14 pips, for a potential reward of 323, giving a reward : risk ratio of 23 to 1.

Reliability : good

Previous trade signal:

TS#87B - Buy GBP/USD at market price of 1.8600 to 1.8610

itme, I've been watching the gbp/jpy form its wedge pattern (daily chart) and I think it will break out to the bottom and drop to around 203.15. What is your opinioin on this pair.

Roger

Forgot to post the chart, here it is.

http://i6.photobucket.com/albums/y22...ie/gbpjpy5.jpg

We agree, Roger, both GBP/JPY and EUR/JPY are both excellent short opportunities. We are studying the situation to try to develop an entry strategy, since we should already be shorting GBP/JPY since 211.13.

The recent high of GBP/JPY of 211.13 at 6/6/2006 11:00 ET would have been a perfect entry point, but we were too busy to prepare a trade signal, even though we were aware that it occured.

The long term trendline high at 211.38 would have been a preferred entry, but there is no guarantee that it will ever hit that level again after that trendline was already touched six times over 40 days.

This morning's high of 211.13 satisfied out system criteria because is represents the following formula:

GBP/JPY recent high = convergence ( "QTL1: +1" ; "QTL2: 0 (+5 pips)" ; "QTL3: 0 " )

The normal and most frequent target of a move, and the turnaround point, is either QTL1: 0 or QTL1: +1. When a currency reaches QTL1: +1 it has travelled further than when it has reached QTL1: 0, so the likelihood of a reversal is even greater.


The more targets that the currency simultaneously precisely fulfils, the greater the likelihood of a reversal. Thus the above formula which includes QTL1: +1 PLUS two other prime targets precisely is an extremely high probability reversal point.

In addition, the 211.13 price independently fulfills the criteria of a reversal point according to an entirely separate second model that we employ.

Therefore it is an ideal entry point for a short.

Because with my new wave calculus I can objectively delineate a prime reversal point, I am going to consider a short at 211.10 a system compliant trade for research purposes, and assume that a stop was placed at 211.51.

Looking at the chart, I don't expect another entry opportunity at or near to this level. So I recommend entering at the best price you can find as soon as possible.

For research purposes, I will assume that we entered at 211.10

Stop is 211.51

Risk is 50 pips

Target #1 is 208.85
Target #2 is 206.80

Reward (T#1) is 216 pips
Reward (T#2) is 421 pips

Reward : Risk ratio (T#1) is 4.3 to 1
Reward : Risk ratio (T#2) is 8.4 to 1

For research purposes only.

Hey Itme you mentioned the EURJPY as well. What kind of targets would you set for that based on your system?

I think EURGBP is gonna be going down very soon also.

Right now there is a re-entry opportunity on GBP/JPY at about 210.75

There is right now a good re-entry opportunity on EUR/JPY at about 145.00

Thanks ITME. What about the other pairs you called yesterday? USDJPY, GBPUSD, EURUSD, USDCAD and USDCHF?

Wednesday 6/7/2006 10:30 ET

Thanks for the question. Yesterday's trades only consisted of buying GBP/USD - which was based on the false assumption that this pair had reached the end of its downwards trend. The GBP/USD only moved up about 35 pips from the double bottom before turning around and plummetting.

We figured this out and shorted GBP/USD at the top of the rise to 1.8636, gaining 80 pips profit on the way down to the low of 1.8450. We then waited for the rise to 1.8647 and shorted again, and are currently holding to the bottom at about 1.8525 to 1.8450. We were unable to post these trades as the server wasn't responding.

We didn't mention EUR/USD or the other pairs you mentioned above yesterday, but the day before we gave some failed signals on these pairs based on erroneous assessments of the trends.

We also analysed GBP/JPY at length yesterday, explaining why 211.13 is the probable pyramidium of the trend.

We analysed EUR/JPY in depth as well, but couldn't publish the results due to the server being out of commission.

We accurately predicted the top of the EUR/AUD at 1.7350, but haven't presented a full analysis yet.

Wednesday 6/7/2006 10:30 ET

TS#89 - EUR/JPY is presenting an ideal selling opportunity right now at 145.16

Stop is 145.38

Target #1 is 144.50

Target #2 is 144.12

Target #3 is 143.84

Target #4 is 143.24

Risk is only about 25 pips

Reward for Target #4 is 189 pips

Reward : Risk ratio is 7.6 to 1

For research purposes only.

GBP/USD just retraced quickly 60 pips on the C of an ABC Wave 4 correction to 1.8590

This is an ideal low risk, high reward short trade opportunity, with a target of 1.8450.

Hello Itme,

I am trying to figure out what time zone you're in. If you could please tell me in Eastern Time I would appreciate it. Sometimes you come out with trade ideas and I look at the time of your post and it does not correspond to the time on Forex Factory.