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Sunday, April 29, 2012

Looking Ahead: Week of April 30 through May 4

The focus is on the consumer, starting with personal income and spending on Monday. Motor vehicle sales post Tuesday. ADP gives a hint on private employment at mid-week. And the highlight is Friday’s employment situation for April. Other market movers include ISM manufacturing (Tuesday) and ISM non-manufacturing (Thursday).

Monday, April 23, 2012

EUR/USD Trade April 23, 2012

Looking Ahead: April 23 through April 27, 2012

Equities were mixed last week as investors monitored earnings reports, sovereign bond issues in Europe and mixed economic data from the U.S. and elsewhere. As is usually the case in the last week of the month, there will be a deluge of new economic data. Adding spice this time is a two day FOMC meeting followed by Chairman Ben Bernanke’s press conference. Investors will also be watching the outcome of the Bank of Japan meeting that takes place at week’s end. They will be watching to see what new easing policies the BoJ will announce to push the value of the yen down and inflation up. Peeks at first quarter growth data are on tap in the UK and U.S.

Trading results April.15.12 to April.20.12

No trades this past week. Markets were mixed last week as investors monitored earnings reports, sovereign bond issues in Europe and mixed economic data from the U.S. and elsewhere.

Friday, April 20, 2012

Controlling yourself after a trade

Here is part of an article from Nail Fuller that really hit me. I've had this problems before. Enjoy! I know that most of you have had some good trades and made some money in the markets. But, what did you do after your trade? The honest answer to that question is truly what defines a professional trader. Your mindset right after a trade is at its most fragile, because you are likely either feeling a bit euphoric over your winnings or angry and frustrated over your losses. Granted, you should not experience these emotions too intensely if you’ve manage your risk properly, but you will likely still feel them to some degree no matter what, after all, you are risking your hard-earned money. Whether you win or lose on a trade, you are at the greatest risk to make an emotional trading decision immediately after a trade closes. While there is no miracle-formula for making sure you avoid these emotional trading errors, if you understand and accept the following points you will be far less likely to make them: • If you have just lost on a trade, remember that jumping in the market again to try and “make back” what you lost is an emotional reason for trading, not a logical one. Do not enter another trade right away unless there is a valid price action trade setup that meets the criteria in your trading plan. • If you have just won on a trade, remember that you are not some “perfect” trader who can do no wrong in the markets. Beginning traders tend to get over-confident after a winner or a string of winners, this can cause them to veer of course and “run and gun” rather than trading Forex like a sniper. • Remember, your trading success is not defined by your last trade; rather it is defined by the result of a large series of your trades. To become emotional and react defensively to any one trade is to say that you think your success as a trader hinges on one trade, and it simply does not. You have to learn to take your losses as just a part of doing business in the Forex market. • In regards to taking losses, it will be a lot easier to swallow the inevitable losses if you are only risking an amount per trade that you are truly OK with losing. When you start trading with money that you need for other life expenses, or risking too much per trade, you put yourself at a very great risk for wanting to enter a “revenge” trade after you lose. • Perhaps the best way to control yourself after any one trade is to simply take some time away from trading. Rarely are you going to exit a trade and then get another high-probability opportunity immediately after that. It usually pays to separate yourself from your charts for at least 24 hours after you exit a trade, whether it was a winner or loser. This will give your emotions time to die down and cool off before you begin analyzing the charts gain. Excerpt: http://www.learntotradethemarket.com/forex-articles/part-4-become-professional-trader-putting-it-all-together?awt_l=GcSvQ&awt_m=IxU3aIadwXwtMW

The Power of Introverts

Interesting article about introverts and trading. Study has shown that many successful traders are in fact introverts. They have a more circumspect and cautious approach to risk. Read more: http://healthland.time.com/2012/01/27/mind-reading-qa-with-susan-cain-on-the-power-of-introverts/#ixzz1sZDpSYIX

Tuesday, April 17, 2012

One vs Multiple Currency Pairs

Written by Danielle Franklin
blogs - Currency Pairs
There are many aspects forex traders observe in order to pick the most profitable currency pair. Forex market has endless possibilities and no restrictions on which currency to choose and how many currency pairs to trade. The question is what are the most preferred currency pairs? How to choose the right currency pair? Is sticking to one-pair path beneficial or it is more profitable to multitask?

In order to pick up the currency pair that suits you most, you have to consider the following aspects of forex trading:



SPREAD. Tight spreads ensure to keep your costs down. With smaller spreads you can have more profits due to larger gaps during price volatility and you can also reach your break even point quicker. Most forex brokers offer EUR/USD currency pair with the tightest spread of 2-3 pips.
TREND. It is important to analyze the trend of the selected currency pair in forex market. Forex charts with indicators can ease the process of choosing the most profitable currency pair. Most currency pairs are simply more trendy than the rest.
TRADING SESSIONS. The most profitable time to trade forex is when the market has a lot of trading transactions. Depending on the currency pair, you will have to adopt to the right trading time.
For example:



¨ 7 PM EST to 10 PM EST – Tokie Stock Exchange opens

¨ 8 AM EST to 12 PM EST – NY Stock Exchange and London Stock Exchange open simultaneously (this is the time to trade almost any currency pairs)







Every trader differs with diverse mindset, psychological self-control, trading approach and overall understanding of forex market. Whether you choose to trade one pair or several is entirely up to you. Do not try to imitate other traders you know – your trading style must be picked and chosen by you. Your decision has to be based on what, how and when you wish to trade.

All of us understand that one market is closely correlated to another market. Once you have an experience and understanding of one currency, it seems logical to take advantage of this and trade several pairs. However, most successful traders are fully focused on just one pair (usually EUR/USD). Mastering one-pair forex trading allows you to understand the distinct “personality” of a selected pair and get confident with it. Despite the fact that one-pair traders could most probably use their knowledge to trade any other currency pair, they choose to stick with one.

The main reason for forex traders to focus on one currency pair is that multiple currency pairs requires much more work. Not all traders are able to handle all the information and correlation between currency pairs. Instead of concentrating on one pair, in most cases you spread the attention wide and end up with a headache, lower quality of trades and analysis, and greater risk of under performance because of neglect and loss of both attentive and passive observation of the forex market.

Obviously with one currency pair you might face fewer opportunities; however it doesn’t mean you will be less profitable. Many traders choose to become an expert in just one area rather than being an average in several.

Including other currency pairs to your trading plan may lead to extra pressures you are not always ready for and you might be exposed to less familiar trading style. Generally it isn’t easy to even follow one pair and fully understand all the WHYs involved in real time trading.

I personally tried to watch out for 3 pairs simultaneously and end up being less successful. I was missing out on a lot of information and therefore my personal trading style is just one pair. I am aware of the correlations with other pairs, but right now I only care about one graph. So for me, focusing on just one pair makes me more focused, precise and successful.

That being said, it should be emphasized once again that every trader has a different style. There is no right or wrong way to trade. In may ways trading style of one trader may appear too difficult and even unnecessary to other. All forex trading ways are unique, special and should be personalized according to your agenda.

Sunday, April 15, 2012

Week ahead April 15, 2012 to April 20, 2012

WEEK AHEAD

Retail sales comes to us from the USD and GBP
CBank minutes and rate releases are delivered by CAD, AUD and GBP
Germany’s states its ZEW and ifo business and economic sentiment
Inflation numbers are released in GBP, NZD and CAD
USD has TIC, Claims, Home Sales and Philly Fed Man to deal with

Trading results Mar.08.12 to Mar.13.12

Trading results Mar.08.12 to Mar.13.12
Trade 1 $964
Trade 2 $-500
Trade 3 $-500
Trade 4 $1008

Total profit: $972
Total trades: 4
Winners total: $1972
Losers total: -$1000
Winning percentage: 50%
Risk to reward ratio: 1:1.9

Sunday, April 8, 2012

Who is Taking Your Trades?

Who is taking your trades? Is it you or your trading method?

Every day I see traders blindly following the signals given to them by their trading method. It is almost as if they're mindless robots just jumping in because their method says get in. They throw money into the market without even thinking, and it costs them big.

What is a Traders Job?
A trader's job is not to mindlessly stare at a screen and blindly jump into a trade because their method tells them to. A trader's job is to take their trading method's signal and analyze whether or not the trade is viable.

Being a trader is so much more than having a good trading method. Conquering this market is about being able to fully analyze your trade opportunities first and deciding whether or not to enter second.

Just because you have a method that says "enter on a break of this support/resistance line" it does not mean you have to enter. If your analysis suggests that the trade has a low probability of success you should not take the trade. The issue is most traders do not analyze the market they just follow their trading method. They let their methods own them and they lose.

Before you take a trade you need to be able to look at your chart and get an idea of what is going to happen. Then, and only then, should you consider entering the trade suggested by your trading method. In my method, when I look at an upcoming line break on my chart I ask myself:

1. What happened last time it approached this line/area?
2. What does the candle movement leading up to this point suggest?
3. What does the current price movement suggest?
4. If triggered and entered what possible complications can this trade have?

After doing my analysis, and answering these questions, I ask myself the most important question of all:

"Considering all these things should I take this trade?"

It is not all black and white and you do not enter because your method says enter. The decision to enter rests with you. With every single trade, you need to analyze the market first and decide whether or not to enter second.

Inside you are the tools that will make a world of difference in your trading. With these tools humanity has conquered the world, conquered space, and even conquered nature. The most important of these tools is the human brain. Ninety-nine percent of traders do not use their brain to their full potential.

If you are afraid of using your mind and you want trading to be a 1, 2, 3 simple process then go away. I am serious because this is not the business for you. You will never make it so don't waste your time. The lottery or slot machines are more your game.

If instead you want to be a trader you better start being more inquisitive. It is human nature to ask questions. Don't suppress it in your trading question everything. Use that amazing tool you have locked away in your head and THINK!

You need to think and analyze everything on your chart and you have to learn to put your trading method in its place. You're the boss of you trading method. If it gives you a suggestion you are the one who decided whether or not to take the trade.

Originally posted on 4-13-2010



Read more: http://www.babypips.com/blogs/pipsychology/who-is-taking-your-trades.html#ixzz1rWG12JnA

Trade what the market gives you!

Markets are always changing and last week we had a ton of accouncements that really stired up the market in one way direction. Last Saturday March 31 2012 we had the Chinese Manufacturing PMI preform better than expected and really gapped the price action early Sunday morning. Then we had FOMC meeting and NFP coming out putting the market into a frenzy. With that we had a long weekened! This was the time to scale down positions and be on the sidelines. The market gives what it gives and takes what it takes. The best position during these circumstances is to wait and let the storm ease. It is important that we cannot expected winners all the time and losses are inevitable. Let the market do its thing.

Trading results April.01.12 to April.06.12

Trade results for week of April 1, 2012 to April 06, 2012

Trade 1 Short NZD/USD, -$821
Trade 2 Short NZD/USD, result -$459
Trade 3 Short GBP/USD, result -$404

Total net profit: -$1684
Total trades: 3
Winners total: $0
Losers total: -1684
Winning percentage: 0%
Risk to reward ratio: n/a

Overall a negative week. We will take what the markets gives us. No harm due.

Friday, April 6, 2012

Happy Easter Everyone!


Lets refresh ourselves and start a new. Happy Easter to everyone!

Holiday session

All is expected to be very quiet today with most markets closed for Good Friday, and many traders having already exited for the long weekend. The European calendar is extremely light with no meaningful economic data releases, while things could get a bit more interesting into North America with the US monthly NFP employment report. Still, with equity markets closed and razor thin conditions, any movement on the back of the jobs number will need to be taken with a grain of salt until normal market conditions resume next week. Markets are forecasting a healthy print just over 200k, with no change anticipated to the 8.3% unemployment rate. Any significant departure from the consensus estimate will likely make for some choppy trade on the thin conditions.

We will sit on the sidelines. Do not trade during mixed sentiments, news, and holidays is one of our mantras.

Wednesday, April 4, 2012

Stay away from markets!

Markets have been over bullish for some time and looks to be consolidation. This is a time to sit on your hands and wait for a market direction. Euro/usd has been water falling from 1.33034 ever since and looking to find a bottom. It is continuing to form a low base while heading down. We are looking for a double bottom variation at the bottom for a long setup, however signs show we maybe be bearish after all.

Market Focus for April 4, 2012 Wednesday

ADP and ISM will both offer widely watched indications for Friday's big jobs report.

Tuesday, April 3, 2012

Long GBP/USD April 4, 2012 Tuesday


Currencies fell on Tuesday, with the S&P 500 retreating from four-year highs after the U.S. Federal Reserve said it was less inclined to provide more economic stimulus.
Supportive central bank policies have been a primary catalyst for the S&P 500's surge of 30 percent since October, even though improving economic conditions have also played a part in the rally. Investors still expect a pullback, but markets have remained resilient, often cutting losses going into the close, as they did both Monday and Tuesday.

Judging by today's FOMC minutes that stress economic improvement and improvement in Europe, the Fed is moving away from consideration of further stimulus. The minutes pulled down the Dow which ended 1/2 percent lower at 13,199 and they shaved $25 from gold which ended under $1,650. Lack of new stimulus also hurt demand for Treasuries where Fed buying has helped keep rates low. The 10-year yield rose 10 basis points to 2.29 percent.

Looking for a long trade on GBP/USD
Entry: 1.58914
Stop loss: 1.58679
Target profit: 1.59643