I think @anon81929759 was just holding that up as an example, and I wholeheartedly agree with the points that he has been making. We are both walking the fine line of trying to help you with your trading plan, without just driving you to make our trading plans, which wouldn’t do you any good.
Ideally, you should be able to give you trading plan to somebody else and have them execute the exact same trades that you would execute if you were at the keyboard. This means that your full decision tree needs to be spelled out, which is difficult for most people (at first), because we are not used to interrogating how we actually make decisions.
This, to a large extent, is why most traders become ‘niche predators’, who dominate their tiny part of the market. You talk about ‘fundamental analysis’ like it is a single thing, but having to write out a flow chart that covers every possible aspect of fundamental analysis could be a life’s work. But dealing with only a small part of that (trading central bank interest rate decisions, for example, or correlations between the price of oil and the CAD) is far, far more manageable.
Equally, you want to have plans to deal with trending markets, ranging markets, and news markets, but each plan will be a massive amount of work that, even if successful, does not always translate into significantly greater profits. Some of the great stock traders simply had one or two patterns that they traded, and simply went looking for stocks that fit their patterns rather than worrying about how to trade the stocks that were doing something different.
now perhaps for me being in I.T. and i’m used to dealing with schematics when doing circuit board repairs, logical flow maybe comes to me easier… Perhaps.
but again, this hits on my point from before
i do a flow chart MY WAY and it flows and (as far as i’m concern) it literally goes step by step, i can’t fault it
i literally (when trading) move from box to box and answer each question like a multiple choice form (in a sense)
another part of it, when i gets boring is… REMEMBERING TO RESPECT THE FLOW CHART and it’s importance and not just skip through it because youv’e remembered the steps
but that’s me
now… YOU have to work it out FOR YOU
so what i was saying was…
WORK IT OUT FOR YOU
But Make it specific and detailed
so @Drekieyja was correct, i was showing you a CONCEPT of what to do
I DIDN’T SAY… DO THIS EXACTLY THE WAY I DO IT.
you gotta understand that to
Just want to follow up on this as well bro. Love what your doing. It’s very rare to find someone willing to expose themselves as you have here. Very impressive.
But on the fundamental analysis thing. You look like you desperately want to trade inter-day. Fundamental analysis plays no role and has no business in an inter-day trading plan. All we’re concerned about is when news is going to be released and what impact it could have.
The role fundamental analysis can play is to help with your bias for a pair. On longer time-frames they talk of up-trends, down-trends, ranging markets. To us, we’re only concerned in the here and now. Meaning the price is going up or the price is going down. It can’t do nothing else, these are it’s only two options Having developed a bias on a pair one only has to wait until the price is moving with our bias and well, then we do our thing. Thats how we extract pips thus creating opportunity for profit.
But whatever your thing is, then that’s what you have to do. Keep doing it, never stop. Hopefully, you’ll be showing us all a thing or two in a few months time.
CI really did want to hold back, but a high probability trade on the USDJPY presented itself to me .
Firstly, I knew the fundamentals on JPY were good against the USD and the next big news for USD will be in a few days with smaller economic events for JPY that should not disturb the overall downtrend ATM.
I checked the overall market and it was trending downwards significantly. I used past and future economic events to determine whether a trend disturbing event will occur, which I have concluded as unlikely until the end of the week.
I did a multiple time-frame analysis based on swing trading where I looked at H1, H4, D1, W1 charting.
I based my trade solely on previous candlestick patterns and support level on the charts D1 & W1. Want to hold this trade until the end of the week with further considerations, on hold.
I also know that support and resistances on higher timeframe tend to be more accurate compare to lower timeframes. This trade had 10% TA, 60% FA, 20 SA.
My risk exposure against my total current capital is 4%.
I lowered my position sizing to match my risk management goals.
This type of trend should definitely be a swing trade to maximise profits.
Another note, when two major currencies such as EUR & JPY with good fundamental news are attacking one currency, the USD, the probability of it reaching new highs or lows is very foreseeable, making it a high probability trade.
Reviewing my trade, I should of taken into consideration the psychological point of 110.9 when trading and could of taken short burst trades during that time. Then returning to my overview of the market on USDJPY, a downtrend.
Positive outlook on the ECB, I took a trade believing that the EURO with two positive outlooks in both meetings, will reach close to 1.26 in another few hours.
I quickly exited the trade because of the comment Draghi said “There are a few chances increase rate will be raised all year.” This usually means that inflation might not be an issue.
I lost -$3.19 in my previous trade, and then I tried to do a day trade and lost $1.04
What I learnt during my trade period is that if I decide to swing trade, it’ll be for three days maximum, this is because of unexpected news events that can change the course of the trend. The more practical experience I gain from trading the market, the better I get, don’t hesitate to make mistakes and keep growing and learning with the market.
When you really think about Donald Trump’s comments, it was an attack on the chance to increase the value the US currency, but it does not change the fundamentals of EU or JPY regardless. Therefore, after the comment attack, I believe there will be a recovery of the EUR but JPY for the overall trend later.
Today, the US will have a more optimistic view but does not change the overall fundamentals of EUR JPY, just a perfect retracement chance for me.
Sorry guys, I love the markets too much and I really enjoy it, so I’ll be trading
Trump should want the USD lower for a number of reasons, so I’d be expecting more of the same throughout 2018-19. USDJPY is a great indicator of progress so far…
Only if I held the trade for 30 mins longer , i ended up exiting the trade while at work, since I was concerned something will happen. Also, I exited the trade because the next economic event was the EURO.
Anyways, my results were:
USDCAD: $0.04
USD/JPY: $1.56
EUR/USD: $0.93
I closed before the EURO trade while at work and took a scalper approach where I was only willing to hold the trade for 20mins since GBP news was 30 mins later.
I accidentally went long on the EURO trade when bad news came out which was unfortunate and lost -$0.15 then went quickly went short gaining $0.09 .
After I took a GBP/USD trade and went long but entered too late, resulting in a loss of -$1.26. Than I was thinking that the trend must hit the top end and bulls were getting exhausted, this made me decide to short the AUD/USD but ended up losing -$0.59.
Anyways, that was my plan, if I was sitting on my computer desk may be the trades could be more profitable. Also, I should consider trading “take profit” news events if it is against the trend or was too quick for me jump in.
Today, I’ll be reading the book “day trading and swing trading the currency market by Kathy Lien.” Hopefully, I can learn how to broaden my trade strategies by next week.
I have lost -$9.39 this week, hmmm that’s not good.
Damn - Firefox is messing the screenshots about. So I couldn’t post it until I find a way to get around that !
sorry - I was going to put up a pic of USDJPY daily, showing the continuation of the down-move towards the double bottom just under 108 - and also IG sentiment indicator showing 26% Short as client sentiment !
Not the slightest effect on the daily by anything Draghi said.
Been sitting on my hands for a good many days now mate, but really, I think you came out of a perfectly good bet there !
I can appreciiate it looked a little scary as the retracement set in, but really, I think you need to back off a little bit from “News issues” if you’re going to trade the longer time scales. (Actually I thought your SL was a little tight and your TP might have been a little optimistic, but that’s ok - just a learning curve. )
Anyway, I hope you don’t mind me saying (and of course it’s easy with hindsight) - but I think, people get a bit too scared of “Pending News” sometimes. Yes it can “Spike”, " On the news" - but if you survive that, it rarely has a long term effect.
[Edit - apparently I can save the chart, but not the screenshot ;
Yes and those of us in the “Rest of the world” who see our own currencies getting stronger should welcome it - to an extent, as it makes Oil prices cheaper for us !
Still a long way to go for until it gets back to where it was before the "Bankers scandal "
Yeah, you are right. I am probably getting too involved with news trading when I swing trade. Next week, I plan on swing trading one of my trades for 3 days or longer to practice and see the effects of news actually for overall trend. Changing my strategy, might allow me to see another view point of trading.
Well, I have lost close to 10% of my capital, so I need to put more emphasis on my risk management and position sizing of each type of trade I am going to take, till I get better.
200 units = news trading, less than one hour dependant (practising with minimising my losses). (higher volatility) (aiming to practice)
300 units = day trading, holding it until 6-8 hours. (medium volatility)
400 units = swing trading holding it until 3 to 5 days. (low volatility)
Risk management
What is going to be my maximum drawdown for the week? I assume $4.5 is the aim (2%*$225 for day and news trading) (3%*225 for swing trading)
What is going to be risk per day? 1.25% a day (excluding swing trading)
Need to set realistic S/L T/P, considering my position sizing and risk management.
Need to divide 1.25% on my news trading and day trading daily.
ATM, that comes out of my mind:
Swing trading S/L 70-80, T/P 100-150 (which does not match my position sizing and risk management).
Day trading S/L 22.5 - 27.5, T/P 32.5-40 (might need to re-organise to refit my position sizing and risk management)
News trading S/L 12.5 - 15, T/P 12.5 - 15 (could lead to erratic results, however, I’ll lower my position sizing to practice my strategy)
News trading strategy
When the candlestick rises fast, consider that it might be a T/P situation and go against the economic event data.
If the candlestick moves slowly, go for a quick earn profit situation dependent on whether it was positive or negative. If it meets consensus or it has two different economies with positive and negative. Consider the overall trend of the market and just leave it to swing trading.
Swing trading
Consider fundamentals, candlestick, sentiment and technical analysis.
Need to start considering a technical approach next week, I’ll start with USD/JPY, try using fib and other technical indicators to improve my technical analysis. Only trade one currency a week.
As Falstaff said "I need to back off on “news issues” when trading on longer time-scales.
I’ll leave day trading for later since I need to think about it for a bit, need to emphasise my risk management strategy before it gets out of hand.
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