What should you be doing?

Welcome to Thursday. The day has lots of news, especially for the US Dollar and so we should be looking for opportunities to join the bullish trend for the Usd, after the recent pull back. What I want to talk about today is persistence.

Somewhere in the Rookie section there is a thread with a name like "Does back testing work?" and it mainly deals with "Robot Trading" or so called "Expert Advisors". Unless you are an experienced trader I would stay well away from this these. (a) you need to be a skilled trader to assess the performance. (b) You need to be a skilled programmer to adjust their performance. So lots of work to do to perfect those ideas. See post 21 above. But back testing manually has taught me that there is a good chance that straddle trades work on the daily chart if traded correctly. So I am prepared to trade them. I know they mostly work because i have personally done the study with a paper and pencil.

Anyway. Persistence. If we look at the simple straddle trade described in post 38 above, we find that it roughly made 1 : 1 depending on where your stop loss was placed, then reversed suddenly and is now threatening to go the other way. I was lucky, I moved my stop loss to a small profit, but it didn't go to 1 : 1 for me. Now I am taking the straddle trade the other way. There is a strong possibility that those who, like me, got the direction wrong, will close their shorts. What is a closed short? It's a buy order.

Essential viewing: Here

LOL, I agree..just saw your latest link, nice..

Stay tuned. Keep it going.

I sometimes find myself reading some of the forum post on here where traders talk about all of these indicators that they use and how when they couple this indicator with this one, and this indicator with that moving average, I try it out and my charts become a jumbled, hard to understand mess that is completely incomprehensible. It is only in the times that I realize that profits are made in the long run and not with some flash in the pan indicator that can give me 30 pips every two hours is when my charts and the currency exchange market make sense to me.

I have read many books that use indicators as part of their strategy. I have also read many books that only use price action and price action alone for their strategy. It is the price action strategies that work the best for me. I know there are traders out there that will swear up and down about how indicators help them make extreme amounts of pips each and every day. I know that some of them are telling the truth, most are just looking for clicks to their website or forum and others are just dreamers.

Good forum, I really enjoy it.

Thanks for the input everyone. So a quick topic today is called "Let the dog see the rabbit". An old expression which speaks for itself, really. It means clear out the rubbish so that we can see what needs doing. So often I see charts so full of technicals and indicators that the price is all but obscured.

We need to see the monthly, weekly and daily charts full screen to see what the price is doing. That will enable us to focus on what is happening on the lower time frames and give us a clue, a bias to follow a trend, a channel or what have you - and areas to avoid. Please see post 14, 2nd chart.

Big round numbers. Sounds sexy, doesn't it? Well it is sexy and we are on the lookout for them. Why? Because these are the numbers everyone is talking about. Do you think it will drop below .9500? I might just spend some time looking at 1.0, 160.00, 175.00 and look at price behaviour at these levels.

Here's the thing. If the price is trending upwards, for example, and it breaks through one of these significant levels, it will often call back to "make a base" there, before continuing on its way. This is called a retest and is one of my favourite areas to trade. I get the impression others like to do this and as long as we all keep doing it, we will make pips.

This will be my last post on this thread due to time constraints. I'm hoping I've covered a few topics and more particularly, posed a few more questions than answers.

Here is a chart:



It's a monthly chart and it has, for the sake of simplicity, a 20 period moving average. This is to give us a rough guide to the trend. Your method may vary. But let's just count the up candles above the 20ma line and the down candles below the 20ma line. Now compare those numbers to the down candles above the line and the up candles below the line. We can do the same for the weekly, daily, hourly and 15 minute charts. It's probably easier to measure the pip value of these areas. Anyway, you get the idea.

If we use a few of the techniques outlined in the previous posts we can see it might be possible to make a profit over a long period using consistently good money management. If we were to trade off the 15 minute chart, jumping in when it is obviously the right time, allow winners to run and cut short losers, what do you think might happen? It's easy really, but completely counter intuitive.

Here is an example:

But don't take my word for it. Do the work and prove it for yourself. Thanks for reading.

I believe the O/P is a genuine and nice guy who meant good but unfortunately he may be sharing some of his trading ideas which are generally right but are not entirely correct. The most important thing for any new aspiring forex traders is they must start learning starting on a right footing or they will end up like a totally frustrated and disillusioned blue arsed fly chasing after the elusive and unreachable rainbow.

I am going to pass on this simple knowledge with regards to trading the EuroGbp pairs only once this time and never to repeat again. This pairs is quite predictable but remain illiquid mostly. The right way to trade this pairs is just a 60EMA on the 60min chart and a pip value of 50pips.(forget all the other TF charts and indicators). Every time when price move more than 50pips past this ma means price is about to turn/reverse as long as it does not come back below/above the 50pips mark after it crosses. (I will not explain the consequences if this happens so as not to confuse/complicate the learning process as it is quite profound which maybe someday I hope to be may be up to it to explain it.) So back to that basic/elementary of 50pips crossing the ma methodology, enter a buy/sell trade on a first initial pull-back of 20-30pips with a SL at the 50pips mark and take profit on the 120pips mark or for those more intrepid traders take profit only as and when the PA crosses back the 50pips mark upon crossing the next subsequent crossing process. This simple method not only has quite a high success/strike rate and can pull in quite a handsome payback rewards(high RR) but it also set you off on a right footing as you explore and build up on this method where a much bigger and handsomer rewards awaits you when you discover the next aha level/moment.

I have no malice in my posting and my intention is explicitly meant only to help. My apology should anyone is offended.

I will leave you all to go get those green pips and will disappear as if I never been here before.

Adios......

GS.

@ Smikester thanks for sharing.

Sorry about the late reply, in UK right now..it's been a doozy and nope, not here for the elections. Just about to read the rest of your posts and catch up..

I hope it's been a good doozy and I truly hope at least one of my posts has helped someone.

LOL, wish I had really stayed put back in UK for the rest of the summer..it is blazing hot down here .. maybe I should relocate to alaska..
Anyway recently got one of those "can you mentor me" emails, so I copied this thread and sent it over..so hopefully it helped that trader..

Just keep doing what you are doing and itt is a good read, for everyone and believe me, I do enjoy reading your thread. On the pro side, you don't come off as condescending or pessimistic as some of the other er..experts here, lol

I decided to resurrect this thread. I'll have a read through and see if there are some things I can add. I see rookies making simple errors all the time.

This has to stop!

A few words about levels.



This is an hourly chart which covers the period 4th January - 15th January 2018 - less than 2 weeks. The grey box highlights how price behaves (how traders behave) around big round numbers. Traders are opening and closing trades around these areas.

The yellow line which is labelled W1 is the 2011 high. The year high for Eur/Usd in 2011 - 7 years ago and this price affects trading on the hourly chart on a Tuesday morning in January 2018.

This is a big subject, worthy of a thread of its own. Because it is so important, my suggestion is to study these levels, how price reacts around them and apply it to your trading. People glibly say indicators don't work. The simplest indicators work and they can work well, but faced with a level of importance, whether it is the day open, last week's close, or the 2011 high, they can fail.

Hi,

2 years back I came to know about Forex from my uncle who lives in Spain. From there i started to gather knowledge about the market. It took me 4 months to gain the knowledge to become a trader. After that, I started a demo account and made some profit. I got excited and opened a real account. That was my worst experience. Many of the trades hit the S/L (even the market never went to that point) and when i asked my account manager about that he said it might be because of the current spread. So, i ignored the whole thing and moved on & i think that was my mistake because after that that happened with me twice and eventually i left trading. But, From the past 6 months I've been taking classes of Forex and now i want to try a new broker with the equity is 500 euro. Can anyone suggest me a good broker who doesn't do inside trading? If you guys know please let me know.

Thanks

This is very much useful video! Yes, I am also doing my technical analysis based on the recent moves of the market chart!

I would suggest using a micro or nano account for a few weeks to assess how well you can do. Do a web search for an "award winning broker". Maybe do a bit of research by asking people here.

Simple and obvious, but only when someone points it out!

I don't really see much opportunity in the majors at the moment. Everything seems to be consolidating. However, consolidation break outs can be very lucrative for the longer term trader. Take a look at the monthly and weekly charts and look for pairs which have paused in consolidation in an otherwise strong trend.