Not a good days trading today, i got stopped out on the OB i took on the cable at 7:45 gmt
I took a trade at the GU just now.
Stop loss at 1.7761.
This trade is based on resistance of trendlines shown in yellow and red. An IB formed and I entered.
What other complimentary information did you take into account for this trade Ray?
What about time of day? Is the Tokyo session usually a key opportunity window for this pair? How bout the current zone or area in which price finds itself? is it a high risk or low risk entry zone? what is price currently doing at this level?
Iāve marked up the past 3 or 4 days activity on the 15min chart below & zoomed in a little closer to magnify the past few hours action mainly to highlight how I see this specific level in relation to the past couple days behavior.
I sure hope your trade returns a profit for you, but bear in mind today is quite busy on the economic front for the Pound.
We got Halifax House Prices out at 9.00am followed by the MPC Int Rates decision & statement a little later.
How willing do you think the serious players will be to get involved in any substantial bets ahead of that news output?
Just look at how price is stringing out leading into todays London activity. Is it still trending or ranging on the smaller (15min) timeframe?
Yeah, It is a bad trade. I got out of the trade at my break even point. Now must go back and review this trade of mine and make sure I dun commit the same mistake again.
I wouldnāt say it was a bad trade, thatās a little harsh. It might not have been the best risk play youāve executed this week, but you can at least work on that.
Every time you step up to the plate you need to be asking yourself a couple questions:
Is this a potentially low risk/decent reward trade?
Does it match up with my tried & tested preparation criteria? In other words, does it fit & tick all of my ļæ½must haveļæ½ boxes in order to hit the deal button?
Is this the type of price activity that usually returns a positive outcome for me?
If it doesnļæ½t, or there are a couple of borderline issues, then you need to decide whether to step aside & wait until a cleaner opportunity presents itself, or maybe reduce your stake/size & keep close tabs on the situation.
Inactivity is also a valid position in the markets.
You donļæ½t have to be constantly active out there. You got the choice of when & where you execute. Leave all the gambling, higher risk & ill-prepared activity to the knuckle heads & those will woolly or loose plans.
Get your structure nice & tight, test it to ensure youļæ½re happy with the content & only execute when it all comes together!
Iāve been continuing my forex education since my last post. Iām getting a better handle on support/resistance, including pivot points. Iām a little weak on Fibonacci and drawing natural trendlines as opposed to horizontal support/resistance. Hopefully that will come soon.
Before I apply some of the technical analysis indicators discussed on this thread successfully, I realize I need to develop the habit and ability to do a ātop-downā analysis on multiple timeframes (another area Iām a little weak at as I am tempted to just look at one chart only). Iām starting to see that you use long term timeframe to define overall trend, intermediate level timeframe to confirm that trend (or at least find the end of a counter-trend pullback that is about to take off in the direction of the long term trend) and finally you look for your entry points on the shorter term timeframe. I am finally starting to get this in my head (I think).
Hereās my question: I read things where people say that trading off of a longer term timeframe is good for those who cannot sit and watch their charts all day. I just cannot seem to figure this out. It makes no sense to me. I am one who can only trade a few hours a night (if that) since I live in California and have a full time job. To me it seems āfasterā to trade off of the shorter term timeframes. If Iām watching a 1 hour candlestick to close at the place I would like to see to pull the trigger, I could be there all night waiting for each subsequent candle (for example if I am looking for a break of or a bounce off of support/resistence, MACD or stochastics cross etc.). What am I missing here?
I think the three charts that will best suit my needs based on my personality, amount of time able to trade, etc. will be the daily for long term trend, 1 hour (or 15 min) for intermediate term, and 15 minute (or 1 min) for the chart to pull the ātriggerā. Given my situation does this seem reasonable? Any guidance on this area would be greatly appreciated. Thanks.
If youļæ½re comfortable with say a 60/15/1min combination & it fits your aims & expectations, then get to work on it & begin testing-refining your game play.
As long as you can identify the specific set-ups & triggers you intend to use & can get in & out of your trades with positive risk measures, then youļæ½re achieving your goal, yeah?
You have to assemble a strategy, which not only suits the conditions youļæ½re executing under, but also (& just as importantly) your own personal circumstances.
If I was in your particular shoes then Iļæ½d be looking at a similar scenario.
Hourly, 15 & 1 or 5min comboļæ½s are fine, especially if you can operate when liquidity/volumes are at or nearing full flow.
As weļæ½ve said before on here: a recognized support & resistance zone on a Daily or 240min timeframe will show up just as clearly on a 15 or 1min timeframe when it comes into view!!!
As an example; If 1.8450-60 is plotted on my 240min frame as a key watch level, then itļæ½s not all of a sudden going to disappear as it approaches on my 5 min frame is it??
So, if you plot a watch level from a higher timeframe, then wait till it begins to home in on your 60/15/1min radar screen & get ready to observe the action. If it sets up according to your triggers/analysis aims on your own personal timeframe combinationļæ½ļæ½ā¦then youļæ½re good to go!
Similar scenario playing out on Cable. Top down view offering up a sensible risk reward entry this morning on that pair?
If you position yourself to the correct side of enough of these types of situations, then as long as you can locate decent risk, your net exposure will be heavily biased to the positive.
Executing these kind of trades with sufficient breathing room on your r/r ratioās affords you options as & when price reaches 1st line targets.
You can either fully encash at your intitial goalā¦part encash & trail up remaining stakes?..add-in your partially encashed stakes on any pullback & continuation of price thru 1st line barrier?..choices are numerous if you get your angles correct from the outset!
4 hour for the general bias & momentum slant
15min (or 60min if more appropriate) for a quick view of any close quarter upside-downside s&r locations
zooming in to identify & set up the entry & emergency exit positioning
magnified view via the 1min frame for getting in closer if desired?
Ok, so prices managed to butt against this next line s&r zone highlighted in the previous post as London closed itļæ½s doors.
That level (1.8500) equates to Cable printing just 68% of itļæ½s current average daily range off todayļæ½s 1.8263 lows.
That leaves 115 pips worth of movement still in the tank (to 1.8615) if traders decide to run it further in New York trade.
Likely? Who knowsļæ½.& more to the point, who cares. As long as you got clear guidelines (pre-planned levels & back-up information) to work with, all you need do is use it to suit your own ends.
Value continues to sit to the upside for those still holding their longs with acceptable risk bias for continuation.
Prices are maintaining their positive peak-trough behavior & whilst these higher high/higher low steps remain honest, the decisions are pretty easy to arrive at.
Tess your target was indeed hit during the NY session. Is it very often that the previous days range can be used in predicting a target?
Still learning of course, but if I am correct the next resistance will now be 1.8790 while there is a fair chance that we might go back to 1.8515-1.85 before going up again? Well we will find out tomorrow.
As I donāt have time to trade during the London hours I sometimes paper trade the NY afternoon session, but this is clearly not very rewarding as the moves are smaller and volume is really thin.
Therefor I try to improve predicting targets so that I can maybe try do some longer term trades, however again the best entry points are mostly during the London sessions.
Have followed this whole thread including both James 40-100 pips and it has been of great value to me, so I would really like to thank you and Jocelyn for the marvellous graphs with their excellent explanations.
Hans
Hello Hans
The average daily & weekly range potentials are observed & utilized as part of our overall analysis package. We donļæ½t hang our hat on their exact measurements, merely use them along with our pre-plotted support & resistance guides & other complimentary info to offer us an additional leg up in our planning.
There are times when they are very accurate, almost to the pip. And of course when conditions tighten up or over extend, you can toss them straight in the trash LOL. But, as with everything we utilize, a degree of common sense & flexibility, with one eye primed for the unexpected, is always in play.
Obviously, the average intraday (& collective periods) ranges will change as price contracts or expands on itļæ½s weekly journey, & on that note: todayļæ½s Cable top end potential comes in at 1.8852, whilst the low end marker (providing the days high remains at 1.8592) hits on 1.8265, which is yesterdays intraday low.
Yes, London definitely drives the FX volumes. New York can indeed whip up some heavy duty activity every now & again, especially if a news/economic event prints out of whack, but generally the activity is muted & well below London volumes.
Glad youļæ½re enjoying the content. Feel free to contribute whenever you wish! 
Some tech levels & zones to maybe hook onto the radar for next week.
Price rejected this previous zone of supply on itļæ½s 1st visit this week. The rejection has been orderly & insipid to be honest & as long as it holds the positive peak-trough steps, buyers will step in to add to their positions.
Been a decent marker though for profit taking off this hike thru the 1.75 reversal.
240min focuses the supply level & upside barriers. Buyers should pitch it cleanly thru 8600 on momentum plays if this higher low leg stands up to inspection.
If not then the lower leg supports are clearly visible with the 1.7900 handle the likely destination for profit-takers/dollar bull chasers.
Early Septembers advance off that visible s&r zone has pitched Euro back to another sticky area of previous activity.
Itļæ½s been repelled for now, but any lethargy regards the Dollar & this pair will quickly gather momentum thru that sludgy 1.50 ceiling.
4 hour magnifying this supply zone & assisting in grading out the profit taking as momentum dried on this leg.
Similar scenario here too regards the higher low intent. If it stays honest, then buyers will be encouraged to prop it on pullbacks.
If not, lower swing levels will be the target of sellersļæ½ā¦focusing that 1.42 zone as the major target area.
Hi Tess,
your charts are again very helpfull as they show the support and resistance levels as I had drawn them as well.
One question though, you state that if the EUR breaks around the 1.4485 level then the target would be 1.42 That is indeed a level that makes sence considering it is a round number and the S/R levels of the first half of September.
However in my graph I set a line on the 1.4280 level as a level that was tested more times on the longer term and in September there was a gap at this level while it was tested a few times as well.
So now of course Iām very curious how you see the 1.42 as the high probability target?
Hans
As with any level of semi-importance Hans, itās simply a guide. Price might hit it on the button, it could vibrate maybe 50-80 pips either side of the zone. We use these zones & levels as markers, not exact measures.
All kinds of influences could unfold on the price action between now & then. As long as we get our triggers & set-up confirmations, & they sit comfortably with our risk parameters for the trade, we can then put our trade management to work & observe the action as it opens out.
If 4280 is an area that youāve identified as a possible reaction zone according to your own observations, then you need to prime your strategy to focus in as & when the price action approaches.
Iām simply using the 1.4200 marker as my most immediate demand level where players hit the gas & pumped this sucker North.
That zone represents the last major higher low (& decent demand level) leg on this ascent. My hunch is that itās a level where weāre likely to witness strong interaction between buyers & sellers again on any re-visit.
Weāll see huh 
That ābreakā level might be considered a little on the late side though Hans 
A couple of Jocelynās guys have been real interested in that upper contact level highlighted on the hourly & intraday chart studies below.
If it was missed as a lower risk entry, the corresponding pullbacks could be hit as by products.
If the break is genuine & attracts participation the risk pays for itself many times over.
In times of extreme psychology such as weāre witnessing of late, risk to cost ratioās require careful watching.
So todays pullback although quick and fierce was a good short entry, is that what you are saying Jimmy? Just for my understanding :o
Maybe not that particular pullback, given the time of day & the potentially knee jerk content of the news driving it. But there was no need to take that wild cat on anyhow, as youād already still be comfortably short from back up the ladder.
I was referring more to the momentum caused by the initial violent (short-term) directional bias at the beginning of yesterdays trade. Those type of trades are ok to climb aboard providing you can locate a playable risk (stop-loss) measure.
Theyāre similar in behavior to range breakout plays, where the 2nd wave (pullback) momentum is generally the genuine signal to get your boots on.
Iām also noticing that proper chart observation requires something of a clear head. There are times where good decisions are obvious and itās almost like Iām in a trading euphoria, then other times I look at charts and canāt see a thing.
This phenomenon can be credited to a few problems,
trying too hard is one, forcing the trades, tiredness, maybe
after a busy day in the day job is another.
When this occurs leave the charts alone, walk away, get an
early night, read a book, do anything but trade.
It will still be here when you get back.
There is no rush where trading in concerned.
It also needs time for this thread to fully sink in, some
of the concepts take time to acclimatise in the brain.
What I am trying so badly to say is this system needs patience,
which you cannot learn from a book.
My firsts post on babypips. All I can say is what an amazing thread this is. Iāve read through it twice and canāt help but feel Iāve just been on a $10000 training course! Just spent 7hrs printing it all out (its almost broken my printer!- but worth it!) to digest and fully learn from it. Thankyou to all who have contributed. I also wish Tess and Jocelyn all the best in the future.