Good morning fellow Pippers and Pippettes!
It’s such a beautiful and inspiring new week, isn’t it ? You can just feel the positive energy everywhere waiting for you to suck it up and make 100 pips today !
The sun is shining, the birds are chirping, pips are jumping up and down, what more do you want
So how does boring me, start my trading day ?
I walk into the office, say good morning to everyone, the boss, the colleagues I hate, the hot chic who everyone flirts with, my plant by the window… its so sensitive, the poor thing. Then I sit on beloved second home of a work desk and boot my pet monster with an accompanying “Dee-Dee” like… “ooooohhh what does this button do” expression on my face….
Aaaahh la vie… Love it people, breath it, appreciate every second of it, it ticks away ever so quickly, the sooner you realize it the more things you will be able to accomplish in this life and the greater of a legacy you will leave behind when you are one day…sniff… gone
So lets recap on last Friday yes ?… ofcourse YES!
Friday was a very interesting trading week, with news granting a lot of volatility and opportunity for experienced traders to make a carefully achieved profit.
If you haven’t been following through…
1: http://www.babypips.com/forums/attachment.php?attachmentid=53&d=1166104541
2: http://www.babypips.com/forums/attachment.php?attachmentid=63&d=1166183366
3: http://www.babypips.com/forums/attachment.php?attachmentid=61&d=1166177536
4: http://www.babypips.com/forums/attachment.php?attachmentid=64&dw=1166191862
5: http://www.babypips.com/forums/attachment.php?attachmentid=65&d=1166195798
Over all, the results using the system have been vary profitable as you can see.
I don’t expect you to have caught the last trade, as it was an experimental trade, which I placed with a very tight stop as the situation allowed me to do so.
Regardless the results were good and it’s once more proven that news cant change the major up-down-bias sentiment.
The trade was entered at 1.3180 and was trailed with a 30 pip stop loss to as far as 1.3090 for a profit of 90 pips, as if the other 20 we made coming up from 1.3145 and the 58 coming down from 1.3165 weren’t enough ?
Total 168 Pips on Friday. I’m happy.
So back to the Present.
How do I start working my charts at the beginning of the day and what do I do first ?
I open up the H4 and D1 charts and take deep breaths in na�ve attempts to better sense the trend direction.
Right… When I’m done breathing I start actually “looking” with my eyes : )
What do I look for ?
Something I like to call EMA Spreads and Bunches, aaaannnd they look like this:
http://www.babypips.com/forums/attachment.php?attachmentid=71&stc=1&d=1166432153
So, what did you notice there if anything ?
The regions which I have called SPREAD are where the EMAs (50,10,20,50) are showing respect for each other and have a significant gap between themselves.
This is a good trend or short term move. Your AIM is to try and notice spreads just as they happen, at that point where the EMAs start moving away from each other right after the consolidation, if you can catch that and all signals in my system are pointing to an “all go” situation, then trade as soon as RSI breaks 50 and you have a 5/10 EMA crossover.
Whether you just catch the EMAs as they start spreading apart or you come in later when the spread is greater, the important thing is to stick to the base principles of my system.
Further, after each SPREAD there is a period where the EMAs BUNCH together.
During a BUNCH your senses should alerted and you should be evaluating the situation carefully waiting for an entry confirmation based on signals using the 5/10 crossover.
Now that that’s over. Lets take a look at the charts today.
http://www.babypips.com/forums/attachment.php?attachmentid=74&stc=1&d=1166433123
The price is currently at 1.3093 after it bounced off 3059 to take a breather or correct.
NOTE: In a good trend or move the price action is normally handled by the 10 and 20 EMAS and occasionally the 50 EMA if the correction is larger. Should the 50 break though and your experience tells you it will go further then it is time to quit and wait for another trade.
For now the RED 10 EMA on the D1 Chart has handled the price correction at 3115.
My thoughts are as follows ( I try and avoid the word “feelings” ):
Scenario 1: The price will break 3059 with the following consecutive targets:
A: 3040 (200 EMA - AKA Great Wall Of China) B: 2938 C: 2899/2900 D: 2760
Scenario 2: The price breaks 3131 with the following consecutive targets:
A: 3188 B: 3292 C: 3364 D: 3482 E: 3668
The price correction from 3059 may go to as far as 3131 before coming back down to retest 3059 to carry out Scenario 1.
If it breaks 3131 starts moving to 3188 we could be having a much larger consolidation with which the bias would shift slightly to the upside.
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My bias today is bearish and this is my probable trade:
http://www.babypips.com/forums/attachment.php?attachmentid=76&stc=1&d=1166433360
That is all for now, we just have to wait and see what the market gives us.
Regards,
E. Lang