The Active Forex Traders Discussion

[CarrieW]

I wouldnt use me as any indication of that lmao! only reason I think its going to go up is because I had a trade open all night short and lost just over a dollar on that trade. the rsi is still slightly below 50 BUT its toying with 50 and I think it will break out and continue to go up.

I have no idea why I believe this so please dont go by what I am doing lol.

 

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[willymo]

I am looking at a 61.8 fib retracement on the 1hr chart and a ton of stops are sitting at the previous weeks low that I think they are going to try and take out.

 

[CarrieW]

I looked at the 1 hour and I see what you see. lets see how it plays out!

 

[willymo]

Looks like it reversed at the 50 fib level now looking for a 61.8 fib retracement on a lower time frame to get in if it gets below 5680 level

 

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[CarrieW]

yes I am beginning to agree with you on the short. however I think I will sit this one out for a bit as I have hit my downdraw limit on this pair lol.

 

[willymo]

Nothing wrong with that. Good money management is what keeps you in this game.

 

[willymo]

shorted at retest of 5700. 30 pip stop; lets see what happens

 

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[willymo]

Closed my short for a break even. Done for the week!!!

 

[Udine]

Hi all,

have not been around alot, due to busy at the office, sickness and trading. Have been getting my daily dose almost every day. I have added a new system to my arsenal which brings me nice pips as well on the different timeframes.

There is some update, as I have been asked to trade for a fund and it could well be that I will go for that

I'll keep you guys posted.

Green pips

Udine

 

[willymo]

Stochastic divergence on the weekly GBPUSD chart. Smart money may try to raid stops above 5926 then slam it down locking in all break out traders. This is just my humble opinion, please take with a grain of salt.

 

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[CarrieW]

nothins better then fresh spam in the morning!

 

[willymo]

How has your trading been going?

 

[garyfritz]

Lousy. I'm trading 3 independent strategies right now, with the idea that one could blow up and the other two would keep me afloat. I was up 20% in the first 3 weeks of February. Then in the last week of Feb ALL THREE strategies blew up at once! I went from +20% to -5% in a week. I've been flat since then.

The worst thing is, the main system I've been trading -- the one that I thought was going to be my strongest system and provide the majority of my income -- seems to have died. Ever since last fall when the Greek crisis started going critical, it just hasn't been working very well. I'm still trading it but at half the leverage I used before. The other two are still working but they're much much slower.

So I'm pretty bummed. And continuing to search for a new system to add to the rotation.

 

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[CarrieW]

still chugging here... trading is basically the same as before. I am 50% winning trades but still losing $$ in my account... I am down a total of $9 right now.

 

[outsourcery]

Shitty time to be trading off technicals... eyes aren't on the screens, they're on the headlines and the markets are thin.

Personally, I've taken the year off to pursue another business. Until europe is worked out, you're going to have a tough time of it because the flow of funds is erratic. Japan is quietly broiling in its own juices, and an election year in the US.

I prefer a more boring news outlook for technical FX trading. If you're gonna make money, it will be about trading the market response to news releases, not something I've ever done particularly well.

 

[CarrieW]

outsourcery--- I know what your talking about... part of the reason that I am still trading is that my goal is to be a full time trader. ok scratch that I am already a full time trader my goal is to become a profitable full time day trader lol.

this requires me to learn how to trade in any and all conditions. the fact that I am mostly able to maintain my capital in the current trading conditions is very comforting to me.

the experience I am gaining watching and participating during all of the craziness is well worth the $9 I have lost. lol

 

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[^eagle^]

Up another 10%. Up 60% since August 1, 2011. No work on my part. All EA except I happen to catch one no brainer last week for a few. 1.5% I think.

 

[willymo]

Lousy. I'm trading 3 independent strategies right now, with the idea that one could blow up and the other two would keep me afloat. I was up 20% in the first 3 weeks of February. Then in the last week of Feb ALL THREE strategies blew up at once! I went from +20% to -5% in a week. I've been flat since then.

The worst thing is, the main system I've been trading -- the one that I thought was going to be my strongest system and provide the majority of my income -- seems to have died. Ever since last fall when the Greek crisis started going critical, it just hasn't been working very well. I'm still trading it but at half the leverage I used before. The other two are still working but they're much much slower.

So I'm pretty bummed. And continuing to search for a new system to add to the rotation.

Try this out on demo (It's called the ICT ATM Method). Just some of the things I learned from the Inner Circle Trader.

SUPPORT & RESISTANCE

On the long side, when a market falls down to a prior low it is more significant than when a market falls down to a prior high.

On the short side, when a market trades up to a prior high it is more significant than when a market trades up to a prior low.

In other words, the more times a support or resistance area is "hit", the more significant it is. Support and resistance areas are very important to consistent setups.

Types of Support & Resistance Levels

Natural Support & Resistance Levels:

1. 12 Month Highs & Lows (12 month range)
2. Quarterly Highs & Lows (i.e. January – March range)
3. Monthly Highs & Lows (4 week range)
4. Weekly Highs & Lows (trading week range)
5. Daily Highs & Lows (24 hour range)
6. Session Highs & Lows (Asian, London and New York)
7. Intraday Fractals (short term support & resistance intraday)
8. Trend-line Analysis (channels, Supply & Demand lines)

Implied Support & Resistance Levels:

1. Fibonacci Levels
a. Retracements
b. Extensions

2. Pivot Points
a. Monthly Pivots
b. Weekly Pivots
c. Daily Pivots

Institutional Price Levels

The Institutional Traders utilize the Figures (every 100 pip price), .20, .50, and .80 for timing and exits. This is very valuable when you consider these players move the market and not speculators… so we can look to time trades in the current trend and around these “natural support & resistance levelsâ€.

TOP DOWN ANALYSIS

The concept of Top Down Analysis is a method used by Professional Traders to analyze the financial markets from the long term, down to the short term perspective.

As a Top Down Analyst we want to begin our study on the Monthly charts and look for Key Support & Resistance levels and try to determine the long term trend or directional bias. After consulting the Monthly Chart, we zoom down to a Weekly chart and repeat the process of analyzing the Weekly chart as we did on the Monthly.

After we note the essentials from both Monthly and Weekly timeframes, we turn our analysis to the Daily chart; where the process is repeated. Once we have our Key Support & Resistance levels on all the Long Term perspective charts we can really zoom down to Intraday charts for fine tune entry and exits on trades determined on the higher timeframes. This in essence is the core of Top Down Analysis in trading.

The Basic Top Down Analysis Checklist

1. We study the US Dollar Index for general market direction

2. We refer to The Commitments Of Traders Report (COT) and note the Commercial Trader’s Net Position.

3. We consider the Commercial Traders as the “Smart Moneyâ€â€¦ and thus try to position like trades.

4. We refer to and monitor daily the 2yr, 5yr, and 10yr note line chart overlay.

5. On the T Note overlay we look for Failure Swings to provide clues to the future direction of the US Dollar.

6. If the yields are dropping and one of the 3 yields fails to make a lower low, we look for US dollar to bounce.

7. If yields are rising and one of the 3 yields fails to make a higher high, we look for US dollar to slide lower.

8. A bullish US Dollar translates to lower Foreign Currencies.

9. A bearish US Dollar translates to higher Foreign Currencies.

10. We look at the Monthly, Weekly and Daily charts of the Currency Pairs we trade noting Key Support & Resistance levels.

11. We determine the Market Flow on the Daily, 4 Hour and 60 Minute charts via Swing Highs and Lows.

12. We try to trade in line with the long term (Top Down) directional bias and when the 4 Hour Market Flow is in sync. This will filter many false signals and assist us in high probability trade setups.

13. Once we have directional bias, then we move down to our 5 or 15 Minute chart for entry.

14. For a short - once price starts to retrace, pull your fib from the swing high to the swing low and look for entry on or between the 61.8% & the 79% fib levels. Reverse the procedure for a long. MAKE SURE YOU HAVE SOME CONFLUENCE WITHIN 5-10 PIPS OF YOUR ENTRY

15. Set your stop 5 - 10 pips above or below the swing you pulled your fib from.

16. 1st take profit should be 20 - 30 pips (in case price reverses on you). Take atleast 50% off your trade there and move your stop loss to breakeven. To find your final profit taking area, pull your fib from the low to the high of the retrace swing for a short or from the high to the low for a long and set your take profit at the 161.8% fib extension level.

17. When there is no definable direction… we remain flat and sidelined until there is a clear bias.

 

[outsourcery]

outsourcery--- I know what your talking about... part of the reason that I am still trading is that my goal is to be a full time trader. ok scratch that I am already a full time trader my goal is to become a profitable full time day trader lol.

this requires me to learn how to trade in any and all conditions. the fact that I am mostly able to maintain my capital in the current trading conditions is very comforting to me.

the experience I am gaining watching and participating during all of the craziness is well worth the $9 I have lost. lol

I've traded full time for a few years... if you're a discretionary trader (I am/was), you need to spend time understanding 'what' you're learning. This was really hard for me, and I imagine it was hard for everyone, because the people who teach trading dont talk about it.

If you spend all day staring at a roulette wheel, even if you do it for 10 years, you'll get no better at guessing the numbers, even if you have a few good runs. Please consider the implications of that. You're trying to build a business, you need to have a framework, and you need to be working systematically to achieve your goals. You can waste your life chasing an illusion, no one will stop you, very few will warn you.

Many 'traders' I have met on the net have no informational advantage, and don't try to build an advantage through education. Instead they think that time and wasted money are a substitute. They're not. Make sure you're learning something of tangible value, that helps you feel a little more informed each day. Finding a new MT4 system is the opposite of what I mean

There is a reason by the market is broken into 2 big players- macro funds who can sit through a draw down that you cant, and wait for the market to catch up with a change, and the HFT crew clip tickets of everyone. Anyone else in between is meat in the grinder. Yes, 'flow of funds' provides an 'income' stream to the FX markets, and these non traders get their tickets clipped. And Yes, some people make money in between, but so do some of the people who buy lotto tickets. Those that win aren't better shoppers, they're just lucky.


Systems that everyone on this thread seems to be obsessed with, are a mechanical exploitation of the market. I don't believe in them, because any recurring, systemic malfunction is likely to get mopped up by much bigger, and faster smarter firms. The other systems, the momo kind (momentum) are transiently good. Tinkering with MT4 and thinking you'll get ahead (as a business) when goldman and JPM have hundreds of people and super computers running cross market arbs is a dream, and not a good R/R bet.


I'm not trying to dissuade you from trading... I'm just suggesting that you step back from the screens and think about what you're learning and how you're improving. If you find yourself on a carousel, you need to work out how to get off.

I stepped back because I couldn't rationalise my view of the market, with the market action. Rather then try and force the market to bend to my perception, i've decided my time is better spent elsewhere for now.

I would suggest No Brainer Trades - Strategy, Outlook and Ideas for Forex Traders. Forex Trading Blog, Education and News. and hussmanfunds.com as good places to start in terms of rethinking market analysis (both have very very extensive 'back catalogues' of articles) and both are created by people who actually have to make a living day-in-dayout from the markets.

 

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[^eagle^]

All systems are mathematically based. That is the winners Take profits out weigh the losers losses. Once we pull the tirgger we cannot will the market to go in the direction we want it to. It simply doesn't happen. that is the reason we have stops in place to keep an objective viewpoint. What a lot of people fail to get is that standing on the sidelines is a position.

STANDING ON THE SIDELINES IS A POSITION.

There are thopusands or even millions of ways to deduce how you pull the trigger. But does that system or method give you a win rate that will out perform your losers.

I have been visually back testing Udines method coupled with some of my own perceptions and have to say I am quite impressed. Udine has a definite edge. I only wish I could be at the table to throw down the trades he does. All you need is the edge. You don't have to trade in all markets. It doesn't make sense to trade in all markets. If the markets are not acting predicably why would I be in them. Once I pull the trigger I am helpless. Wait for your set up. make sure your risk to reward and win rate are positive. Pull the trigger and walk away. It wont help to watch it. thats what the pigs do. Bwe a bull or a bear. Not a pig or sheep. accept the losses and move on. In the long run you win as long as you have an edge.

The timing is also crucial because you need to know who is in the market. My EAs work on the Asian Time frame. It has a different market rhythm than the european wave. Know your markets waves and more importantly when to stay out. accept your losses and move on knowing you will win in the long run.

Surfers dont surf when its choppy. Baseball players don't play when it rains. It's more important to recognize when you shouldn't be in the market than when you should.

 

[Udine]

Eagle,

great observation. You need to be a trapper not a hunter. In military terms: a sniper.

Look at the market and if it looks crappy go do something else: Rule nr. 1 Capital preservation !!

When you see a trade set up: first think of how much you could lose and not of how much you might win. Get consistent in your trading. If you have set some rules, stick to them and go for only 10 pips a day.

I trade only the EU and GU, both have an ADR of over 100, so 10 pips of that should not be too difficult. If it is, then something is wrong with the system you trade. Then analyze what is not working and search and adapt until it does.

When you get consistently 10 pips day in day out, you will notice something interesting, first your account is growing nicely, but your confidence is increasing also... which is important as YOU are the holy grail

In the meantime I have reduced my riskfactor down to 2 % and still doing great, although this morning was not an easy morning.. not completely stressfree...

Still in the process of becoming a trader for a fund.

Green pips

Udine

 

[^eagle^]

Hey Udine. Do you move your stop to break even at some point. Im getting up a little earlier now Andam trying out a first signal on m15. Went down to 6 pips and started to struggle. Letting it ride as my usual instinct is to slam down my stop to Break even. Thoughts?

 

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[billbrownfarm]

May I butt in here and suggest "Studies in Tape Reading" by Wycoff? Sorry for the intrusion. I'm gone.

 

[^eagle^]

Hey Udine. Do you move your stop to break even at some point. Im getting up a little earlier now Andam trying out a first signal on m15. Went down to 6 pips and started to struggle. Letting it ride as my usual instinct is to slam down my stop to Break even. Thoughts?

Stopped out for 15. I
Was a little late entering and it's possible it could have made it to ten . It still looks good. Going to try again tomorrow
It was up seven before it went negative then positive again so I let it ride. Would you have brought the atop down on the second attempt in positive territory. This was onthe EU around 5:30 am NY time

Edit: silly me. It' s FRIDAY! LOl.Well next week is around the corner and so are the big bucks.

 

[Udine]

Hey Udine. Do you move your stop to break even at some point. Im getting up a little earlier now Andam trying out a first signal on m15. Went down to 6 pips and started to struggle. Letting it ride as my usual instinct is to slam down my stop to Break even. Thoughts?

Hi Eagle,
yes I have an Trail stop EA that automatically kicks in @+5 pips. SL @ BE and trails pip by pip.
the trailstop kicks me out early sometimes, but I see that as capital preservation. My TP1 is set @ 15 and exit half, the remainder I trail until its hit.
Green pips
Udine

 

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[^eagle^]

Well My roof is done so finally got a few extra minutes so I started watching the news again as depressing as it is. QEIII? Barf!

Anyway. Got a straddle order on Audusd set to kick off at 9:28 EST. My News EA ready to take on the Oz CPI. Anyone else in?

 

[^eagle^]

Damn! Had My minutes andmy hours transposed on my EA timer. Missed a good trade. Would have been an easy 20 pips or more. Note to self. Double check your inputs before you set up and go another minute or two earlier. Would have been an easy 50 Pip plus night. F$*%!

 

[^eagle^]

Set up news straddle on Canadian News in 4 minutes. HeyUdine! Like your trailing EA but if you combined it with James 16 trade manager it would be even better in that you could do both the trailing and the partial Take profit that J16 trade manager automating both. Just a suggestion.

Edit:
Just blew right through my buy stops. Didnt open a one of them. Opened a sell on the e/u a while back using Sam seiden no brainer trade. Closed out 80% at 15 and trailing the rest with invictus.

And out for 11 on the final 20%. 1% on the day. Gotta call Oanda and find out why I didn't get filled on my buystops on CAD news. That would have been a nice chunk there.

 

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[Guest1254]

Anyone recommend a good broker for noobs trading with small balances ($100)?

 

[Udine]

Set up news straddle on Canadian News in 4 minutes. HeyUdine! Like your trailing EA but if you combined it with James 16 trade manager it would be even better in that you could do both the trailing and the partial Take profit that J16 trade manager automating both. Just a suggestion.

Edit:
Just blew right through my buy stops. Didnt open a one of them. Opened a sell on the e/u a while back using Sam seiden no brainer trade. Closed out 80% at 15 and trailing the rest with invictus.

And out for 11 on the final 20%. 1% on the day. Gotta call Oanda and find out why I didn't get filled on my buystops on CAD news. That would have been a nice chunk there.

Hi Eagle,

there is the THV4 Cavemanager V1.4, which has it all: trailing partial exits, etc, etc. You can find it on the Forexfactory.com website: THV system, final edition - Page 1528 @ Forex Factory.

By the way: well done on the green pips

Uding