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  • #20,581
  • Jan 20, 2015 2:40pm Jan 20, 2015 2:40pm
Quoting EternalNewB
{quote} Hi T. I posted asking you about risk management in the weekend but I guess my post was lost in the flow so here it is again Care to elaborate a bit more about your personal risk & money management ? do you use a fix $ / trade ? thanks for everything
I will use the thesis which i elaborated through my plan so you will get an idea. Risk is 3% maximum per DAY. In that day you could trade multiple setups risk only 0.5 % average/trade.

Scalping is usually done on 5m TF so:

-Risk is always based on total risk per day ( max 2-3 % daily)
-If the risk is 3% and we have eg :10000USD that makes the total risk of 300 USD.
-In the example below we can see that 0.5 lots is optimal for each 10000. On each 10000 we raise the lot size for 0.5.
-I personally use 3 % of risk per day average.
-For 5m scalping we use last swing high/low and or Hourly PP.
-Maximum SL for scalping is 20 pips.

Attached Image


Intraday trading is done on H1 though some system/methods use 15m tf which is also correct. MTF analysis usually take into accounts 2 timeframes for trend spotting and 1 tf for entries. I personally favor H1 for intraday setups, but i know that 15m is also good for finding potential entries.

-It is usually daily 1-2 setups per pair
-Stops on hourly trading go from 25-50 (max) usually around 30 pips
-Optimally its 0.3 with 50 pips SL
-I usually go with 30 pips SL

Attached Image (click to enlarge)
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My risk per trade is generally low so that allows me to have a nice advantage even when there is 2 or 3 losing trades. By intraday trading we can also assume "Session Trading". The optimal trading hours are the first 3h of each session. London, New York, Tokyo. Good setups which are positioned close to a major session open are usually the best ones.

Generally my risk per trade ( for intraday including scalp swings ) is 0.3-1 % per trade. Sometimes if i spot a really good setup which should be a no brainer trade, i can raise my risk to 3 %, but if that happens, that is my only trade for that day if SL is hit.
  • #20,582
  • Jan 21, 2015 12:59am Jan 21, 2015 12:59am
Quoting T@rantula
{quote} I will use the thesis which i elaborated through my plan so you will get an idea. Risk is 3% maximum per DAY. In that day you could trade multiple setups risk only 0.5 % average/trade. Scalping is usually done on 5m TF so: -Risk is always based on total risk per day ( max 2-3 % daily) -If the risk is 3% and we have eg :10000USD that makes the total risk of 300 USD. -In the example below we can see that 0.5 lots is optimal for each 10000. On each 10000 we raise the lot size for 0.5. -I personally use 3 % of risk per day average. -For 5m scalping...
Most grateful T. thanks a lot
  • #20,583
  • Jan 21, 2015 2:42am Jan 21, 2015 2:42am
Quoting EternalNewB
{quote} Most grateful T. thanks a lot
You are welcome
  • #20,584
  • Jan 21, 2015 2:42am Jan 21, 2015 2:42am
USDCAD is in uptrend. First POC comes around 1.2050. There is a triple confluence of L3 and DPP, 38.2, with previous breakout level where near term buyers are. Second POC is 2020-2010 with L4 confluence and that would be a deeper pullback on intraday chart. Target is 2100 then 2160.

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  • #20,585
  • Jan 21, 2015 8:43am Jan 21, 2015 8:43am
We are having profit taking on both sides before ECB. DOnt panic guys.
  • #20,586
  • Jan 21, 2015 9:01am Jan 21, 2015 9:01am
GBPUSD short into rallies.
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  • #20,587
  • Jan 21, 2015 9:05am Jan 21, 2015 9:05am
Quoting T@rantula
USDCAD is in uptrend. First POC comes around 1.2050. There is a triple confluence of L3 and DPP, 38.2, with previous breakout level where near term buyers are. Second POC is 2020-2010 with L4 confluence and that would be a deeper pullback on intraday chart. Target is 2100 then 2160. {image}
200 pips UP!!!!

Pre FACT and POST FACT!

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  • #20,588
  • Jan 21, 2015 9:09am Jan 21, 2015 9:09am
Quoting T@rantula
USDCAD is in uptrend. First POC comes around 1.2050. There is a triple confluence of L3 and DPP, 38.2, with previous breakout level where near term buyers are. Second POC is 2020-2010 with L4 confluence and that would be a deeper pullback on intraday chart. Target is 2100 then 2160. {image}

+ BOC reduced Overnight Rate
  • #20,589
  • Jan 21, 2015 9:18am Jan 21, 2015 9:18am
Quoting Jumper1979
{quote} + BOC reduced Overnight Rate
Yes. that happens when fundamentals are aligned with technical. Those are the best trading days.
  • #20,590
  • Jan 21, 2015 9:23am Jan 21, 2015 9:23am
AUD fell sharply to USD at same time.

Expectations must be shifting that the RBA will follow a similar path as BoC sooner rather than later

AUD has been oversold in my opinion at USD 0.8162
  • #20,591
  • Jan 21, 2015 9:26am Jan 21, 2015 9:26am
Quoting PariCovek
AUD fell sharply to USD at same time. Expectations must be shifting that the RBA will follow a similar path as BoC sooner rather than later AUD has been oversold in my opinion at USD 0.8162
Definitely oversold even on intraday timeframe. 8135 should hold for bulls.
  • #20,592
  • Jan 21, 2015 10:25am Jan 21, 2015 10:25am
Where is the AUD heading now?!?
  • #20,593
  • Jan 21, 2015 11:15am Jan 21, 2015 11:15am
Not sure it would reach there. But I want short at 1785-1800.
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  • #20,594
  • Jan 21, 2015 3:58pm Jan 21, 2015 3:58pm
Quoting PariCovek
Where is the AUD heading now?!?
Not sure. Need to see daily close.
  • #20,595
  • Jan 21, 2015 6:21pm Jan 21, 2015 6:21pm
Silly move I made to buy in at 81.70, even though I realised that expectations may shift for RBA to follow BoC.
  • #20,596
  • Edited Jan 22, 2015 2:04am Jan 21, 2015 11:00pm | Edited Jan 22, 2015 2:04am
I'm not convinced the RBA will cut rates in the next couple of months. I have a connection at a large Australian Home Construction Business and the word on the street is that they are selling new homes like "hot cakes". I also think the reduction in petrol prices is enough stimulus for the time being and that the RBA will sit on the fence to keep the "powder dry" for another day. I mean Australia already has a record low central bank rate.


It was only a couple of months ago that the RBA and OECD were warning about the risks of the Australian housing market:
http://www.afr.com/p/business/proper...iZFvP7tPuDjUHP
http://www.afr.com/p/national/oecd_t...nSSQOzMVuc9rKI


The RBA wants lower exchange rates, down to the USD0.75 level is the target, it has been able to get to USD0.80 without a single rate cut in the last 12 months!

Look what the USD/AUD pair did after January 2014? We have much lower commodity prices since January 2014, but there is certain sense of Dejavu...


Having said that, most bank economists are predicting a rate cut sooner, and the Australian bond markets have priced a 50 basis point move south, which is a very good indicator of rate cuts.


Despite all this, behind BoC's rate cut, the Canadian economy has a much larger exposure to the Energy Sector (and oil prices) than Australia:
http://en.wikipedia.org/wiki/List_of...oil_production
http://en.wikipedia.org/wiki/List_of...gas_production


The RBA meeting is 7 working days away, I think sentiment will swing in the interim. I think the RBA will sit on the fence this month and observe Canada's rate decision and analyse the impact it has to their economy in months to come.


RBA may drop rates sooner if the commodities prices fall further south (namely the Aussie exports of Coal, Iron Ore, Bauxite, Gold, Liquefied Natural Gas). As LNG is linked to Oil prices, there is some talk that the price of LNG may be decoupled from Oil and its price subject to natural market forces, but this is probably several months to years away. Australia's banking exposure to LNG is not so large yet, so the main impact to the economy is that it may stall future projects, but there is limited banking downside.


I am bearish on the AUD over the next 12 months, but I'm betting against short-term sentiment and a continued rally relief for the next couple of months.


Happy to hear others views, particularly technical analysis.


The AUD looks like its on the knife edge, but no panic yet, I mean the BoC is not the RBA!

Also keen to understand how much has the market priced in the anticipated rate changes (Future RBA cash rate *Range of 2.5% to 2%* v Future Fed rates *Range of 0.25% to 0.4%*)?

AUD/USD has fallen 14.88% since July 2014 (0.95052 to 0.8090).
  • #20,597
  • Jan 22, 2015 4:16am Jan 22, 2015 4:16am
Quoting PariCovek
I'm not convinced the RBA will cut rates in the next couple of months. I have a connection at a large Australian Home Construction Business and the word on the street is that they are selling new homes like "hot cakes". I also think the reduction in petrol prices is enough stimulus for the time being and that the RBA will sit on the fence to keep the "powder dry" for another day. I mean Australia already has a record low central bank rate. It was only a couple of months ago that the RBA and OECD were warning about the risks of the Australian housing...
Excellent article!! Your fundamental knowledge is high. I will repost this one.
  • #20,598
  • Jan 22, 2015 4:30am Jan 22, 2015 4:30am
Quoting T@rantula
{quote} Excellent article!! Your fundamental knowledge is high. I will repost this one.
AUD nearly cracked 0.8110. Looks range bound at the moment bw 0.8080 and 0.8110. I think it should retrace to 0.8140 in the next couple of days.

BoC rate cut is a bit of "spook" event in relation to the AUD in my opinion.
  • #20,599
  • Jan 22, 2015 6:18am Jan 22, 2015 6:18am
Quoting PariCovek
I'm not convinced the RBA will cut rates in the next couple of months. I have a connection at a large Australian Home Construction Business and the word on the street is that they are selling new homes like "hot cakes". I also think the reduction in petrol prices is enough stimulus for the time being and that the RBA will sit on the fence to keep the "powder dry" for another day. I mean Australia already has a record low central bank rate. It was only a couple of months ago that the RBA and OECD were war
...
onomy is that it may stall future projects,...
Thanks for your view Pari, look forward in having a conversation with you. Are you versed in fundamentals ? I am learning it as well, as I go along. Your views have definitely been helpful.

In my own opinion, I feel the AUD is awaiting more decision from other CBs, a rate cut, would be nothing more of a temporary relief then a long term solution.
As a commodity currency, its export will pick up when there is demand. and hence, I dont think a rate cut will be a clear cut solution. Recent PPI CPI unemployment is still acceptable and I dont see how will a cut improve its economy.
It is not dependent on oil, rather, it exports refined oil and given the low oil prices now, it should benefit them rather.
In the coming months, should FED decides on the rate hike, that should be more then sufficient to propel AUD to at least a 77-79 level.
If fed continues to be elusive on it, I look for AUD to retrace and maybe, depending on how economic conditions pan out, then maybe that is something we could ponder on.
BOC is directly link to oil prices, and when compared with AUD, they are definitely more affected. In order to remain competitive and maintain its balance, its decision is a tactical one till at least the next OPEC meeting.
I am bearish and would think aud/usd move sideways till the next rba meeting, year end target could very well be in the .77 region and i look for a fail retracement till the 84-85 level before headed down.
Given that, I try not to have anything in mind while trading as that affects the flow and rhythm in my mind.

Justmy 2 cents, love to hear your views.
Fall in love with the process, and the outcome takes care of itself.
  • #20,600
  • Jan 22, 2015 6:32am Jan 22, 2015 6:32am
Quoting PariCovek
Silly move I made to buy in at 81.70, even though I realised that expectations may shift for RBA to follow BoC.
Today i will stay away from technical analysis due to impending ECB conference.
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