Late night trading

Well, that was brutal. Hung in there and it finally reversed for around 25 pips.

My original target price was 170.950 so it will be interesting to see if it rebounds all that way...I know one things for sure, I lack the trading nerves to see it thru after enduring a trade gone bad all night. So I took the nearest profit and we trade another day.

I think I was done close to 100 pips somewhere during the night.

What will tonight be all about? It's looking like the big boys are pushing it up so they can short it at the London open.

So far, it looks like that's my play this evening. Again, things are still setting up but from my perspective a short entry at 170.312 looks like my action unless a strong bull run happens in the next 30-45 minutes.

Kinda figured that good news on the pound woulda lifted us up a bit more...then again, this is Sunday.


After Carl Lewis won the gold medal for the long jump in the 1996 Olympic games, he was asked to what he attributed his longevity, having competed for almost 20 years. He said, "Remembering that you have both wins and losses along the way. I don't take either one too seriously."

News is coming out in 20 min...I was long and decided to lock in the profits and just wait to see what happens.

It looks overbought but every time I say that to myself it finds a way to 100 pips higher...safe = moving forward.

Good afternoon to anyone reading this...I just woke up and it's 1:30 in the afternoon.

I was reflecting on my trading as we often do and, of course, as I'm sitting here drinking coffee and beating myself up it came to me while I'm in a trade that has gone 65 pips against me. How simple is this game of trading? I mean really? We all know the basics:

1. buy low - sell high (reverse for shorts)
2. trade with the trend

But this where the confusion lies. We call it being subjective. One guy looks at the chart and says 'put the fibs from here to here', 'we've bottomed' or 'the trend is long'....and 50 of us agree and 200 disagree. Cool - that's what makes this interesting and a challenge.

Let's face it, you ain't gonna be paid rockstar money doing an easy job.

So, in my hour of reflection (which began at about 4:00 this morning), I realized it boils down to another set of absolute basics, just 2 actually. These 2 will make a man a tremendous amount of money provided he has a cool head and can remove emotions from his game..and yes, these are as obvious and similar as the 2 above:

1. direction (trade with the trend)
2. timing (buy low - sell high)

But for the life of 10 stressed out traders, how do you do this while being subjective. And I am basing this on what I see myself do right and what I do wrong...if you are not rocking the world in your trades see if you can benefit somehow...let's discuss direction:

1. to understand direction a trader must zoom out on his screen...go up one higher time frame from your preferred trading time frame...and then zoom out...which direction is the market heading? This is where the trap lies doesn't it? The GBP/JPY is trading sideways right now to most people, a real meat grinder. But is that true? What can help?

2. add an indicator to your higher time frames. I don't care what those pompous "price action only" wizards say...they don't pay your bills...use an indicator to tell you tonight's direction for your trade. Is the pair you are trading overbought or oversold? That is the only purpose of the indicator. Whatever you choose to use for an indicator, it should tell you the direction. Suggestion? Stochastics set at 5,2,2 or CCI set at 3.

If you have gone up a time frame and it appears to be overbought, move up another time frame and see if that too is overbought or still moving upwards...a reversal may be imminent (probably the case if both are overbought) or continuation.

3. draw a diagonal trendline on your trading chart to watch that specific trend. I got suckered in last night on a pull back because my trend line was aggressive (I zoomed in). I had reversal on my mind and missed an obvious clue.


Tonight I will write about timing, specifically, Fibonacci retracements (support and resistance) and using multiple diagonal trendlines (high and low at the same time)...this is the crucial to our success.

Sorry about not posting yesterday, I'm having some complications from the knee surgery.

Anyway, that trade from Monday night killed me...I went short and the pair went long so what do you do? You exit. So I tried to do so gracefully but there never was a significant pullback (at least while I was awake)...so I got killed on the trade.

The same night as soon as I exited my failed short, I went long.

Last night was really a gamble because that could've reversed so fast. It hit several key resistance points...the "experts" will talk about momentum being too strong. One big player exits his buys or a news release from Japan and that momo would've halted.

But hey, I'll take it. I'm closing in on where I was before the bad trade...maybe tonight we surpass it.

Almost forgot to write about timing. I'm going to physical therapy in a few minutes so that post will happen later tonight.

I will write about: fibonacci retracements for exit strategy and PSAR for timing an entrance...these two are crucial. For anyone to benefit I will cover where to put the fibonacci and when...but remember, I'm not the expert. Just compare it to the information on the subject you have studied elsewhere.

This post should generate much thinking on the readers part. You will make money off it in a big way so stay tuned.

What do you have that wasn't given to you? Paraphrasing a scripture in the Bible is appropriate for me trading forex technically. Everything I now know is because of searching the internet message boards, in particular, ForexFactory...all for free.

So this is for the person who isn't looking for the answer in the first post of a thread, but the nugget buried.

Direction and Timing...direction was covered in a post above so you should have a pretty good idea which way the market is gonna trade. Nothing is concrete - you and me - can misdiagnose direction just like a doctor can misdiagnose a disease...many factors are at play. So let's assume you have your play lined up and you are correct for a trade tonight...hypothetically we go long.

Fibonacci retracements...I searched and searched for this information and found what I was looking for buried in the thread by Bobokus...you can read all 430 pages if you like. I have zero affiliation with him, he doesn't know I exist. I altered a lot of his methods as you will pick and choose what I write if you are still reading.

The biggest confusion about fibonacci comes with where do you put the 2 points and where do I buy/sell? Well, here you go.

1. Always keep the 100% on the top point and the 0% at the bottom point

2. you will pick the high point and the low point between the hours of 12:00 pm EST and 3:00 am EST...the close of each on a one hour chart. If you're stupid like me you will jump the gun and enter a trade prematurely because you didn't wait for the 3:00 am EST close.

3. get rid of the actual fibonacci numbers...use these: -55, -34, 0, 20, 50, 80, 100, 135, 155

4. buy support, sell resistance...20 is your support line and 80 is your resistance line. Some nights this is super easy and others it is quite difficult. If the market is gonna go up and you are hovering around the 20% line you go long and exit at 80%. Other nights the price is hovering above the 50% line and yet you still expect it to go up (like last night)...then you would go long at 80% and exit at 134% (or 155% if it is a strong move)

That's enough for now, I've got to watch the London open and see what I'm gonna do tonight...this is gonna be tricky because there are many resistance levels diagonally. We could be overbought or the market could go to 173.261

Well this is awesome. I see the pattern for my ego/pride problem I didn't know I had.

It's like this...I can bowl with an average of 250 when I bowl by myself. I join a league because I'm pretty good (in my mind) and my average goes down to a rock solid 175.

What's my point? I seem to do pretty good at trading until I make a comment in this log. I start caring what others think about my style or my return...screw it. I'm going back to silent trading mode. The method I'm using is in the post above. It's reliability is unmatched.

About using PSAR for timing...once you are certain that a pair is going in a certain direction switch down to a shorter time frame (example you are trading off the 1 hr - switch to the 15 min) and wait for the price (candle) to hit the PSAR dot...for example, you are going long but the 15 min chart shows PSAR dot on top of price (meaning price is tanking). As price reverses it will hit that PSAR dot as it it going past it...that should be your entry where that dot is. In this case a new PSAR dot will then form under that candle (reversal has begun). Then close out that 15 min time frame and watch your primary screen. Works beautifully.

BTW, it did hit my target price of 173.261 last night but I had decided to exit that trade and go short (which that target price will hit by Tuesday night) because of the extreme volatility of this pair...which is precisely why I trade it.

If you get to this post and have a question, just send me a private messaged and I'll walk you through whatever's holding you back.

http://www.dailyfx.com/forex/technic...cond-Look.html


Simple, technical analysis article proposing an idea that the GBPJPY pair may be heading to Tank City.


Personally, I think an Adam and Eve formation is happening on the 1 and 4 hr charts.

Since this my journal I would like to look back and read this if it ends up being some sort of trading break through for myself. I would like to look back and see where my head was.

I love trading a highly volatile pair and GBPJPY fits the bill. Right now it is in the process of a major battle between the bulls/bears at key resistance area. That creates opportunity and chaos.

It's poised to break thru current resistance and go to 173.700...once it does that, it's off to to the races to 179.500...that's alot of pips.

Currently testing a strategy that focuses on staying in a trade for much longer that I have been accustomed to. It's difficult to implement it right now because the current trend has been running now for about 4 days meaning I missed the correct entry, so, I need a pullback to verify proper entry...exits are based on resistance and Fibonacci (which is resistance areas but allows targets to be calculated within specific time frames, primarily for that particular trading day).

This is a very simple system based on Daily time frame using diagonal trend lines, support/resistance. Longer time frame equals less stress and more pips and I would like to try that so I can go to bed before 4 am, pretty much sick of that. Daily candles start at 6 pm MST for me and that's when you enter, at the opening of the first candle AFTER diagonal trend line has been broken.

Stop loss will be on the candle that broke the diagonal trend line...here's an example so if I get kicked in the head by a horse. First picture is actual set up...second is where I drew trend lines.

It didn't let me post the second picture so here it is...this where I set the diagonal trend lines to establish entry and exits. Must have a stop loss because no guarantee that once it has broken the diagonal trend line that it won't use it as support for a while and slide on down with it (if going long).

Once again, this is a Daily time frame and points where I attached the trend line are in blue...projected exit is in gray.

One more picture. Current trend info so I can compare information.

This is a caveman system, just as basic as it gets and I think I'm ready to love something like this.

Ouch son! That one hurt...glad I had the stop loss in place but I want to get a little more conservative with that tool because on a Daily chart the trend is either gonna run or it is not...should have lost half as much on that stop...will fix.

Looks like GBP JPY is setting up for a short on the Daily...could be just to 38.2% level of current trend or much more.

But it really looks like it will just be a quick short and then she's off to the races, reassuming dominant bullish trend.

For my records in case I get lost in trading methods, the following are very productive for me.

FWIW, I've given credit to whoever I got the methods from but I have modified/eliminated/simplified their ideas. Diagonal trend lines always trump any indicator. All examples are for going long, do opposite for going short.

1 Daily chart (you can use this method as a stand alone method or use it to gauge a trend for lower time frames - works beautifully either way)...5 ema as a filter...diagonal trend lines...once Daily candle has broken through AND closed above the 5 ema then wait for the diagonal trend line to be broken - enter on following candle. Aggressive entry? Once the candle has closed above the 5 ema, enter at the opening of the next day's candle...Set stop exactly where the 5 ema penetrated candle that closed above it. It's either gonna run or is doing a quick pullback. Big pips over several days. Credit goes to ForexFactory

2. FPS...1 hour chart. This is because I am stupid and get so confused at times I can't see the forest because of the trees. Filters...10, 25, 50 ema...diagonal trend lines. The ema's tell you which direction the trend is, the trend lines give you the entry. Pullbacks are good entry points. Credit goes to "Erol Bortucene"

3. Pips du jour...5 min chart. I gotta say that I love this little method, cheesy as it is. Filters...10, 60, 120, 240 ema's. Once the 60, 120, 240 line up wait for the 10 to go in their direction. Premature entry will frustrate you but will give you the pips. Correct entry will give you a nice ride on the pipmobile. Credit goes to "Chester B"

4. Multi time frame...30 and 5 min chart. Filters...8,3,4 Stochastics...5 and 13 ema. Look at the 30 min Stochastics for trend, in this case, oversold condition. Once it breaks 30 level look for long entry...Switch to 5 min chart and forget Stochastics, watch 5 and 13 ema for crossing. Credit goes to ".Pride."

5. Bobokus Fibonacci...levels? -55, -34, 0, 20, 50, 80, 100, 134, 155...where to place? high and low of London exchange session from 2 am MST to 10 am MST using 1 hour chart. Exits at -34 or 134 are safe. Credit goes to "Bobokus" and "simoneg"


All these work well together. As an example, Bobokus Fibonacci works great with #2, 3, and 4. If you use it on #1 then just use it for the previous trend. But remember, 100% always goes on top and 0 always goes on bottom.

Other note: these are cash machines. Financial turn around can occur quickly if emotions are not in the way. Because they are all trend based, set your stops aggressively because the trend is either gonna take off or it's not...get out and re-enter in a few hours.

Use your diagonal trend lines on the high and low points BUT, and this is important, you can go through a past trend to get to the current trend. Many will disagree but when you have a big candle followed by several new candles, well, trend lines don't make upside down L shapes...pick a past point that looks like the current trend and you will see what the professionals are seeing.

Well, I might as well update my journal since its been awhile.

For last nights trade I put the Bobokus fibs on the high/lows of the the previous days London session on the 1 hour chart. The market was trading down but I saw that the CCI (set at 3) on the 4 hr chart was oversold AND the candle was hitting a diagonal trendline in the oversold area as well. So I thought a bullish bounce was gonna happen.

The market opened below the Pivot Point, which I no longer give much credibility to, so the trading bias should've been bearish. It did go bearish for roughly 10 hours. The market was consolidating around the 20% fib level for quite a while and finally tanked to the standard -34% level. I was already in bed by that time and had my Long order set from the 20% fib level (entry for this trade) and 80% fib level (my exit for this trade).

Usually my exit for a bullish trade would be the 134% fib level but since the evening was so bearish I didn't feel (that's right, FEEL) that it would climb that high.

Anyways, it did spike up over a 3 hour period of time and hit my entry then exit.

Tonights trade will be bullish.

The volatility is so high on the GBPJPY I suspect it will tank to hit a diagonal trendline and then climb considerably...possibly forming a double top at the 173.450 price. Obviously I am speculating because who can foresee exactly where price will go?

Fibs are based off of yesterdays high/low of the London session using the Bobokus fib levels, 100% for the high and 0% for the low.

So my trade will be long from the 80% fib level (my entry) to the 134% fib level (my exit)...we are currently trading in the slop but higher lows are happening so a bullish trade is sensible. And, the CCI (set at 3) on the 4 hr chart is oversold tonight.

Just came across your thread and I admire your tenacity. Please post often, I will be following and contribute if you welcome others to post. If you want to keep this strictly a personal journal - just say so.

Comments are welcome profitkeeper by everyone. Hope you're trading well.

Looks like my trade from last night never materialized so I canx the trade.

Looks like the bears took control last night and price broke thru the 172.250 level and could be trying to head down to 171.500 where a major diagonal trendline is sitting.

We'll see tonight.

Edit: looks like price is hitting a major support area right now....




BTW, when you look at my trading graph and you see a huge drop for a loss - that's where I decided to try eelfranz's method on the 4 hr chart using the TDI method. That was using the exact method along with a stop loss...which the stop loss hit. I'm sure it is a good method but my experience with it was a bust.

If anyone knows how to open multiple Trade Explorers I would love to open another to dedicate it to other trading techniques so it doesn't mess up my primary account...