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Your best way to follow longer term trend? Opinions!

  • #61
  • Nov 29, 2015 10:26am Nov 29, 2015 10:26am
Quoting Ozzie Taz
Ok, lets say your happy with your analysis of the fundies and you have picked your trade - ie: in your case 'sell EURGBP'. Whats next? - Do you immediately sell ? - How much financially are you going to test your analysis? - How much draw down are you going to endure? - Where are you going to take profit? - Are you going to scale out and take multiple profits based on particular technical and fundamentals? This is where you start to develop your discretionary trading plan. How about this - you have just decided you want to sell the E/G based on...
  • #62
  • Nov 29, 2015 11:38am Nov 29, 2015 11:38am
Adding to venividivici, great thanks to the contributors(SKFX, Ozzie......). Difficult to quantify how valuable your posts are.
  • #63
  • Nov 29, 2015 12:58pm Nov 29, 2015 12:58pm
I find the problem with a longer term trend is keeping in the trade when a profit starts to erode. The temptation to close a profitable trade on the first pullback is huge. How do others overcome this??

Chris
  • #64
  • Nov 29, 2015 3:25pm Nov 29, 2015 3:25pm
By not exiting my full position.

Scaling out at key technical points or certain fundamental outcomes.
Regardless, i try and leave a very small portion of my trade to go the distance and use large macro shifts or specific locations on a weekly chart as a final exit.
Luck is where preparation meets opportunity.......
  • #65
  • Nov 29, 2015 3:32pm Nov 29, 2015 3:32pm
Quoting skfx
{quote} OP, Taz is laying this all out for you here! You are at the crossroads where you have two choices: 1. You can try and do things the seemingly easy way with as little effort as possible...the quick dirty frustrating money; or 2. You can choose to do it the correct way, with effort, the way of a professional. I can honestly say from my personal journey, that i wasted many of my first years trading spot trying to find edge in the charts alone. I look back from where i sit now and i had no right to be trading a live account. The feeling i get...
Hi Skfx,

Thanks for this insightful post. I have also already wasted a lot of time and energy trying to find a edge in OUTPUT alone not knowing why prices move.
It has been now 5 years that i have been trading demo accounts ,trying different ideas and i have the feeling that i am just turning circles reading and trying the same bullshit over and over again.
Einstein put it this way: "Insanity: doing the same thing over and over again and expecting different results."

In a quest of understanding why prices move i started reading about orderflow and while doing that i am also starting to understand the importance of the fundamentals.
The problem is that i have zero understanding about this matter and i don't have a clue how i can learn this the most efficient way. What is the most efficient way learning this matter starting from zero. Could you recommend me some books or sites that could speed up the learning process?

Thanks in advance,
Nik
  • #66
  • Nov 30, 2015 6:56am Nov 30, 2015 6:56am
Quoting venividivici
So.. the reason the dollar has been rallying is cause of rate hike talks. Also see bad news for the Yen too. Buy USDJPY/GBPJPY? If GBP + USD both hike rates itll be a choppy pair to trade, ofcourse disregarding other red news throughout the year for each pair which may create opportunity. {image} Dollar all round strength. I had some difficulty finding the direction for each central bank for whoever needs it this site makes it much easier: http://www.global-rates.com/interest...ral-banks.aspx {quote} ...
You're on your way V!
Well done matey!

As you may have already likely found out, you get your MACRO/DRIFT from READING.
If you hate reading then obtaining 'drift' will be a tough job. Or maybe you're not so fluent in English which will also make it tough.
But stick with it!
Through 'reading' will you get the REASONS, for say example EURUSD weakness or USDCAD strength. You'll know exactly WHY the pairs/crosses are traveling directionally over extended periods of time.
You will locate/find PRICE DRIVERS.

You may also come across institutional trade recommendations on sites like forexlive.com
Something like:
JP Morgan recommends to stay short EURUSD selling upticks and so on and so on....
What you are interested in here is WHY JPM want to run short EURUSD! We are not interested in prices or SL etc etc
They will give you price drivers from a professional educated perspective.
We do not care about opinions, we care about FACTS....what are the facts? That is what you are out to find!

It is so too with SENTIMENT, if you trade out of the London open then you should be READING what happened overnight and how the markets traded.
This will give you a 'feel' for how the markets may react out of the new open.
Then you can get a plan together.
The charts will also confirm happenings in the session.
For example, you may boot a chart up of USDJPY and see from the Tokyo open it has traded down over 120 pips, the first thing that would run through my mind is that that is quite a substantial move in Tokyo and i would want to source WHY. Did something happen to create 'risk-off trade? Maybe a BOJ official got on the wires and said something 'hawkish'? Is this flow likely to effect trade long-term or short-term?
Or it could be the case that the USDJPY has traded 15 pips either side of the Tokyo open and it would confirm a soft light session.

These are some of the resources i use (you can add these to the ones Taz left you previously):
Financial Times (paid subscription)
Reuters (news app on ipad)
Bloomberg (news app on ipad)
Live squawk and TF (paid subscription)
www.forexlive.com

www.investing.com (live real-time calendar)

It is not necessary to have Reuters EIKON or Bloomberg terminals for success as a retailer. But you need to know what is happening around you and there is enough free and almost free stuff available these days that it's almost ridiculous.

Hope this helps.
rgds
S
  • #67
  • Nov 30, 2015 7:06am Nov 30, 2015 7:06am
Quoting PAStalker
Adding to venividivici, great thanks to the contributors(SKFX, Ozzie......). Difficult to quantify how valuable your posts are.
You're welcome PAS!

You see the value and that speaks volumes about you as a trader.

Take care matey!
rgds
SK
  • #68
  • Nov 30, 2015 7:07am Nov 30, 2015 7:07am
barrier options
  • #69
  • Nov 30, 2015 7:10am Nov 30, 2015 7:10am
Quoting loleno
{quote} I totally agree with this. I've taken numerous and countless short positions on EURUSD over the past few months and have not lost any money. In fact, I've only taken a grand total of 2 long positions but even then I exited them within seconds. In hindsight it wasn't warranted because it was much riskier than shorting. That is the way to trade. Going with the flow of the CBs. Being up to date with the news. Adding to positions if the sentiment temporarily turns against you but the fundamentals still remain the same. Trading using technical...
Well said loleno! Couldn't agree anymore with this!

Yes, and that is the annoying thing.
It took me some time to make the right connections. You sit there staring at it and you just don't see it at the time.
You come back two years later and THEN you get it! Very annoying! LOL
  • #70
  • Edited 2:52pm Nov 30, 2015 7:40am | Edited 2:52pm
Quoting Sitting duck
{quote} Hi Skfx, Thanks for this insightful post. I have also already wasted a lot of time and energy trying to find a edge in OUTPUT alone not knowing why prices move. It has been now 5 years that i have been trading demo accounts ,trying different ideas and i have the feeling that i am just turning circles reading and trying the same bullshit over and over again. Einstein put it this way: "Insanity: doing the same thing over and over again and expecting different results." In a quest of understanding why prices move i started reading about orderflow...
Hi SD(Nik)!

You're welcome!
I'm not entirely surprised. It took me around 4 years to move away from the OUTPUT alone.

LOL....Einstein is right!

Quote
The problem is that i have zero understanding about this matter and i don't have a clue how i can learn this the most efficient way. What is the most efficient way learning this matter starting from zero. Could you recommend me some books or sites that could speed up the learning process?
Yes and this is where precisely most trip up. They cannot get it broken down so its usable information.

(Check my previous post for links and references to some of the things i use)
Just read.
As you read you'll learn new things and how the markets work. It'll take time.
If you do not understand something...Google it!

Taz stated this best really, it's all about focusing on information that relates to CB's and their respective economies.
And to break it all down what you are in effect really doing is finding this:
1. CBs that are DIVERGING
2. CBs that are CONVERGING
These will create trades that last not just for 1 week but for months to years even!

Simply, what we are doing here is, spread trading.
Most professionals engage in spread trading.
You can not only say trade spot and spread EUR against USD but you could say like European equities better than US equities. So you bid Europe and offer the US. You therefore make money on widening or spread divergence.
You can spread almost anything.

As an example currently, you see the ECB and FED going in opposite directions.
So they are diverging(view the rates as evidence).
There may be a time in the future, say in 18 months where ECB and FED begin to CONVERGE, closing the divergence.
The EURUSD spot rate will then respond accordingly.

When you begin to learn all of this, there may be some elements that run above your head.
Do not nonchalantly brush it off!
Find out what it means if you do not understand what you're reading.
The devil is in the details!

rgds
SK
  • #71
  • Edited 2:23pm Nov 30, 2015 8:01am | Edited 2:23pm
See below a 'yield curve comparison chart' i've built using Thomson Reuters data and excel, between US and Germany(European core).
Currently the two yield curves are DIVERGING! (front-end to belly segment)
This in turn influences EURUSD, pulling it lower!

This curve has looked like this for quite some time. You will get slight changes in the two curves and the spread between the two over time, but it is subtle.
The graphic looks like this due to CB policies.
You have the rate traders running off the coat tails of the CBs trying to price them in!
Attached Image


rgds
SK
  • #72
  • Nov 30, 2015 8:48am Nov 30, 2015 8:48am
Quoting Ozzie Taz
Ok, lets say your happy with your analysis of the fundies and you have picked your trade - ie: in your case 'sell EURGBP'. Whats next? - Do you immediately sell ? - How much financially are you going to test your analysis? - How much draw down are you going to endure? - Where are you going to take profit? - Are you going to scale out and take multiple profits based on particular technical and fundamentals? This is where you start to develop your discretionary trading plan. How about this - you have just decided you want to sell the E/G based on...
Solid post Taz!
It all starts with well placed questions.
rgds
SK
  • #73
  • Nov 30, 2015 1:57pm Nov 30, 2015 1:57pm
Quoting barbones
My last thing here. There is no Technical analysis that can go alone without the fundament. There is no institution to provide this kind of "science". There is no timeframe. Price react and move the same on all timeframes. Example: Price is at 1.1440 at H1. In H4 it different? No. the only difference is the Open Close High and Low of the story. Inside H4 we have 4 bars H1. What will tell as? Nothing. If you look at 1 min chart and you will see all the day on the chart, you will see the same price like on 60 min chart or Daily. The difference...
Very true ...... ;-)
Trade fearless not careless...
Syed Mohsin Ali Profit This Month: -557
  • #74
  • Nov 30, 2015 1:59pm Nov 30, 2015 1:59pm
Quoting openyoureyes
barrier options
I would also include Vanilla options greater than 500 mil.
Luck is where preparation meets opportunity.......
  • #75
  • Nov 30, 2015 2:01pm Nov 30, 2015 2:01pm
Great posts skfx!
Luck is where preparation meets opportunity.......
  • #76
  • Edited Dec 1, 2015 6:40am Nov 30, 2015 2:31pm | Edited Dec 1, 2015 6:40am
You guys are on fire!

I don't have a huge amount of time normally to post, but for anyone struggling, i know there are guys here that can help you out if you snag out on application and cannot find the answers when Googling.
I'll leave you with it and get on with my trading.
All the best and good trading to you all!

rgds
SK
  • #77
  • Dec 1, 2015 2:08pm Dec 1, 2015 2:08pm
Hi skfx,

Thanks for your advice and for taking the time to make the yield curve comparison chart.
It makes it visual and that helps me a lot to understand what you are trying to say.

If i am honest to myself i have to admit that i already knew some time that i have to start paying attention to the fundamentals and have to learn how to interpret them. I think i just chose the easy way and kept trying to find an edge in technical analyse/money management.

Now after wasting some more time on the easy way its time i am finally going to choose the hard way.

You and ozzie taz have given me a good info so i know now where to start.

Grtzz,
Nik
  • #78
  • Dec 1, 2015 2:27pm Dec 1, 2015 2:27pm
Quoting Sitting duck
Hi skfx, Thanks for your advice and for taking the time to make the yield curve comparison chart. It makes it visual and that helps me a lot to understand what you are trying to say. If i am honest to myself i have to admit that i already knew some time that i have to start paying attention to the fundamentals and have to learn how to interpret them. I think i just chose the easy way and kept trying to find an edge in technical analyse/money management. Now after wasting some more time on the easy way its time i am finally going to choose the hard...
Goed zo Nik! Je bent ook slim mijn vriend, dat ben ik zeker van !
Graag gedaan matey
gr.
Stephen
  • #79
  • Dec 1, 2015 5:12pm Dec 1, 2015 5:12pm
Hey Stephen, raar om iemand nederlands te zien spreken op Forexfactory dit verwacht je niet.
Ik zie net dat je in Nederland woont, waar woon je ergens in Nederland?

Grtzz,
Nik
  • #80
  • Edited 7:25am Dec 2, 2015 6:14am | Edited 7:25am
Quoting Sitting duck
Hey Stephen, raar om iemand nederlands te zien spreken op Forexfactory dit verwacht je niet. Ik zie net dat je in Nederland woont, waar woon je ergens in Nederland? Grtzz, Nik
Hoi Nik!
Het is inderdaad een beetje vreemd! LOL
Ik woon in Maastricht, dicht bij de binnen stad. Voor 4 jaar heb ik hier gewoond.
Misschien heb je gemerkt dat ik niet vloeiend ben? Ik probeer altijd mijn best te doen, maar de taal is moeilijk haha
Alles is een beetje zo denk ik!

Al het beste met je trading Nik!
Gr.
S
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