Usually news reports retrace about 50% or more, this looks more like it may have been a 50% retrace of the last down trend.
John
not necessarily, sometimes they just carry on going.
It was 50% retrace of the last down move but also a resistance line on the 4hr and 1hr charts but the news is what really moved it down by 100pips+
On the previously mentioned 1h strategy, probably a good idea to close trades prior to a high impact news item
Your right I didn’t trade it I walk away 15 min. befor a major news release so no temptations.
with no retrace after the dust settled I was thinking it might continue down and resume the trend, just a though.
I am watching.
John
We don't see things as they are, we see things as we are.Oh 1 more thing the move started 15 min. before the news after a spike to the upper BB
By jcgibson at 2009-09-30
John
We don’t see things as they are, we see things as we are.
- Anais Nin
Been keeping quite today and setting various patterns on the 1h chart with the view to trading the 1h chart centerline cross with the 14 SMA (the strat that has produced 1100 pips since 17/09).
I think after much trial and error I’ve got the best possible settings?
Obviously, we have a 1h chart up. Set up with a 2 std dev bollinger (20 period). On my chart its a black background, so I’ve coloured the center line boll red. The 14 SMA is green. Now if left alone this set up certainly produces the goods. But with a little management it can produce far more pips.
When the chart can’t be watched i.e. work commitments, sleep. etc. Set a 100 pip moving stop.
When the chart can be watched. Set a 3 LWMA and either close the trade or hedge your position at a price line cross against the trend (in this case up). Resume the long trade when price line crosses through the 3 LWMA.
This has proved to be extremely effective last night and again today. 
I have been using an average price line and not candles. Might be an idea to use both 1h charts side by side… priceline and candles? But so far my preference has been priceline.
Thanks R. I’ll set up my 1h like that this evening since the news is over would you go ahead and enter a trade on it? or wait till the next cross over?
Apologize ahead of time for the ignorant question, but I am not sure how to set a 100 pip moving stop…any advice? Also, when watching the 1hr chart, and the 3 LWMA, am I watching for the 3 LWMA to cross the current price or the 14/20 MA before moving ahead with a trade? Thanks!
:rolleyes: Answered my own 2nd question…3 LWMA crosses priceline (ignore candles).
What software are you using? Metatrader?
[B]SIKDAY[/B]
You wait until price crosses the 3LWMA. Just crossed at 1.5993… now up around 20 pips.
Yep…Metatrader
Thanks…figured that out just in time…also up about 20. I have been trying to get well versed in this with lots of reading/experimenting and small amounts of cash before I get a bit more serious. Thanks for the help. Firefighter/Paramedic as a real job…but getting kind of addicted to this.
[B]SIKDAY[/B]
The 100 pip moving stop is just an idea… its big enough not to get hit by anything except big news and as its moving in line with the trade it will seldom be 100 pips in any event. Case in point. Last night 04:00 GMT for me, I hit the hay and put up a 100 pip moving stop. This morning, PA had moved up another 40 pips so moving stop was - 60 pips. I would suggest that whatever stop size you decide to use it doesn’t represent more than 2% of your account balance. Good money management.
I would also suggest that even when in front of the monitors and actively monitoring the trade a 50 pip moving stop be put up, just in case of a sudden and unexpected move against your position occurs… better to be safe than sorry.
A moving stop is activated in different ways according to the platform. I’m afraid I can’t help with that one. Try refering to your help guide supplied with your platform. Or state which one your using and I’m sure someone here will know?
Thanks for the info…makes perfect sense. I will get that part figured out prior to much more trading.
Cheers
Hi Silday
In MT-4 you right click on your trade in the order window and click on trailing stop.
John
Thanks John…work perfectly!
Just remember that in MT4, you have to leave your computer on and metatrader running for it to trail the stop. Stupid really but that’s the way it works.
Price crosses the 3LWMA or price crosses the middle bollinger?
…or rather the 14 SMA cross the middle bollinger?
Lol - confused now.
[B]SANMIGUEL[/B]
Hehe.
Ok the original idea ([B]TalonD[/B]'s) was to trade the MA crosses of the center line on a 2 std dev bollinger (20 period).
In and of itself this has so far proved to be highly lucrative (1100) pips since 17/09. So with a large enough stop this can be left to run largely ignoring price action and just looking for the bollinger center line crosses with a 14 SMA before changing a buy to sell / sell to buy.
However, if and when time permits, especially during London open - New York close it is possible to actively manage the trade then more pips could be made. Either by closing the trade when PA moves away from the trend direction or by a hedge. Then placing a new long (in an up trend) or taking off a hedge.
I would strongly suggest not actively trading against the trend. It could be a big loser. By closing the position or hedging a retrace against the trend. You are saving the pips you would have built up thus far. If your exit or hedge proved to be incorrect you loose nothing from your balance (except the spread). If you counter trade the trend and it turns out to be incorrect you loose real dollars from your balance.
Sorry rambling a bit there. To answer the question about the 3 LWMA. It doesn’t matter where this is on the chart. Its just used to get a clearer understanding of what the priceline or candles are in fact doing at any one moment in time. Only necessary if you wish to actively manage the trend trade as above.