Hey BB.
No.
I think fractals are the best way. Higher highs and lower lows etc…
I’m aware of the other way. Using a moving average, and anything above would be trending high etc…
And other than that, I do not know of anything else.
Talk to me. What ya thinking? Anything you gonna take from all that? Or is it just interesting?
Mike
Well I learned two things from you Mike that I’m starting to implement. The first is to determine which pairs are in a strong trend and trade them. The second is to try to look for a hedge the way mastergunner does. So I want to thank you for that, unless I lose I will blame you 
I was thinking ADX or Guppy’s MMAs to determine trends. I’ll experiment with the idea today.
Couple that up with rise in EZ GDP , EURGBP or even EURUSD long could be a great play. London open should set the tone for the week I hope. As for AUD its going to be a volatile week, I think. Yet another bad news on housing debt , as prices rose the debt has increased in line. Glenn is expected to speak this Thursday is there going to be another rate cut ? If USD rally is set to carry on, I’m short with AUDUSD on the breakdown provided that market is wary of rate cut.
Hey guys.
Well, it’s Monday London open now. I just opened a EUR/USD going long.
Yeah, this week will be very interesting I think also.
My sentiments are:
[B]EUR[/B]—The flow is high. They are trending high against USD/ JPY/AUD/NZD (weekly’s).
[B]USD[/B]—I don’t feel good about them moving high. BUT…I am watching them against the AUD this week. If I go high with the USD, it would be that one, only.
[B]NZD[/B]—I am very wary of them. Due to the fact of a pretty good correction possible. They have some major news coming out later this week. I’m just steering clear of them. Scared.
[B]AUD[/B]—I’m thinking their gonna tank. Last week showed a good retrace early, then coming back down.
The week went like this: 3rd, 2nd, 2nd, 8th, 6th. My EUR/AUD trade is still open from last week, favoring EUR.
Those are my main thoughts. Not much on anyone else.
And this is for me to always remember: [I]it’s not what I think, it’s what the market is saying[/I].
And I’m just playing the probabilities.
Mike
Yeah, and the German production numbers were better than expected, which was to be expected - sounds silly I know.
And perhaps the comment by Obama ? Are you going to be trading EUR today Peter ? If EUR did jump on Obamas comment on top of German production numbers I would rather sit this one out and see how EZ GDP turns out tomorrow. Or is it just a squeeze ? I feel like such a pro saying the word squeeze :8:
Hey Mike,
Our watchlist is about the same EUR pairs and AUDUSD short. Since I’m late should have entered early London, buying the dip I’ll wait and see what happens tomorrow.
[B]Mike[/B], I’ll try to come up with an indicator in TradingView which measures Currency Strength. It’s a long shot, but I’m willing to give it a try. I’ll share it if it gets done. I want to know what you think about it.
Hey guys,
I realize that waiting for the [B]right level[/B] to get in is just as important as fine tuning the timing of the entry or the momentum. Any thoughts ? Not sure if right level is the appropriate word I hope you all see what I mean by that. I was just looking back at my past failed trades.
Does anyone short or long at the breakout ? I wanted to keep my losses minimal but entry usually requires breakout occasionally the dip Phils system. Ive been finding breakouts tricky as of late. I place trades and it goes opposite to my direction almost as soon as I hit the button. I’m not trying to achieve perfection here 50-75pips SL probably will do but I want to be more precise and keep it within 10-15 if possible lower. I read the other day Peter was closing his position at -8pips. How do you know that was the right time to close the trade ? I’m sure it comes with experience but for me I would need at least 15 pips of move to determine if the trade is working or not.
Hi Rookie,
on my side I need hundreds of pips. I cannot sit there and watch every little move. Hmmm your other topic is interesting and as you said there is a little contradiction. Phils system is usually giving you the right entry on the top or bottom which is everything but not a breakout. So I guess you have to decide what exactly you want to follow.
Peter has written a couple of times about the danger of breakouts as big pockets want to do some SL chases. However we never know when those chases happen. So I guess the best we can do is set at a breakout play a tight SL as a right breakout should make a strong and directional move. If this part is missing then it is most likely not a normal breakout.
FE
Well my 2 cents on this. The most important thing is you need to find a trade plan that suits you. What this simply means is to find a plan that makes you confident in your trades. I used to trade break outs. But the thing about them is that you are buying at resistance and selling at support. Which will result in too many losing trades that get justified by handful of amazing winners. But I was never comfortable winning only twice in every 10 trades.
The other thing I found is that it is much easier to make 150 pips a week, than it is to make 30 pips a day. There is pressure when your day trading to deliver pips. So if you lose that first trade you rush in back to the market to breakeven, only to make things worse. But trying to make 150 pips a week (even though its 30 pips a day on average) is much more relaxed. You focus on one pair where you did all the analysis and you just let it run. Now I felt comfortable watching a pair go 50 pips up, then 0, then -90 then 100, then 60 then 150 to hit my target. Others may not like that. So you need to decide which method you’d like: 1) A plan where you lose a lot and quickly but your winners make up for your losers. 2) A plan where there is more drawdown, but you win more often.
On your question of right timing and right level, you need to ask yourself. Are you concerned with being right? or are you trying to make money? Because both are not the same.
For example, my system does not hold the truth to trading. [B]It is pure bogus if you ask me.[/B] What it does is give a number of mechanical conditions that help me stay disciplined once I enter a trade. I’m disciplined because it tells me when I’ve won, when have I lost, how to manage both losers and winners. [B]Discipline is what makes money and not finding the right levels.[/B]
So my advice would be to go on and search in all the trading systems on babypips (there are a list of trading plans of the month on this forum). Go through them as they are all guaranteed winners. Look for the one that makes you most comfortable and trade it. Once you find that system, all that is left is to apply a money management style that suits you.
Hey Doc.
I hear what your saying. This is my view.
I think that’s risky. I just seems that as many times as it happens one way, it happens the other.
I was just thinking about that this weekend, predominantly with the AUD/USD, and AUD/CAD. Look. Weekly.
Mike
Hey Philip.
Well, I just pulled the trigger on NZD/CAD, going south. You still in it?
Yeah, it might be a bit risky before the news later on today, but, I think the probabilities lean my way.
Reasons:
First off, CAD is trending high against them.
NZD had their run up on Monday, for a good retracement to move on down lower.
CAD was the strongest yesterday, and seems to have momentum continuing.
Look at the weekly chart. And in particular the April 27th candle. I’ve always had this thought in mind. Price wants to eventually hit that low again. And so far, that seems to be coming true.
And the thing I think about the most is this. Is there a greater chance to hit my tp, than sl.
Rather than who’s stronger for a length of time.
I’m sorry. But I just can’t figure out who’s gonna be stronger to weaker in the future. It’s pointless. I tried. But, I can play the odds for swings, (my way). Cause that’s what the market does best.
Swing both ways
Mike
Hi Mike,
sorry, but I have to argue a bit.
I do agree with most things you wrote but I do not agree with you summaries. First of all we never said we know what happens in the future. So we are all the same in that. But the way you wrote about the breakout, it does sound like that Rookie would have lost with his breakout play on the above mentioned chart. Keep in mind, there was no downside breakout so there was no trade triggered. No trade means no loss, patience and discipline paid out on the chart you attached. This pay out was not profit, but in this case it was not losing money.
Of course it is risky as many things in trading. And please read Philips post, it is exactly about this topic: Reward-to-Risk ratio. So as he writes, even if you entered your trade and stoped out 8 out of 10 times but the remaining two makes the home run then who cares about the 8 small losses?
Peter writes continuously about breakouts on short-term, Rookie made also nice gains. Breakouts are extremily efficient, however you definitely have to have better RRR than your 100 pips TP and 200 SL. I do not say of course yours is bad, just try to defend the breakout strategy. As Philip said, it is only about money management. If you have it, then you cannot be hurt on trading breakouts.
FE
Loving the discussion! Thought I jump right in with my opinion 
Philip is absolutely right about the importance of the harmony between the trader and his system. Hands down. Although I would argue (and will) on his statement about the right levels.
A good entry is crucial in my opinion. And we get our good entries at right levels. I always preferred to buy low and sell high. That’s just what makes sense to me. I feel extremely uncomfortable buying right into a rally or sell into free falls. Plus, I’m a sucker for great R:R ratios. I refuse to take a trade which R:R is lower than 2:1. Why on Earth would I want to risk 1 dollar to earn anything less than 2? Anyway, that’s just me, we all have our ways and that what makes trading so interesting.
About breakouts. Been there, done that and lost money basically every single time I tried to trade one. Especially when a trendline was involved. I am so bad at drawing those, that I should post my trendlines so you guys could stay away from them. It feels like I’m destined to trade the worst breakouts. So that type of trading is a no-no for me until I get better drawing.
You want discussion?
Don’t let me start defending myself about the whole [I]risk/reward[/I] topic.
No, seriously. All I have to say is, there’s nothing you can say to me that I haven’t already heard. I completely understand the reasons for more reward than risk. (Cause you guys have noted that, also, many times)
But, for the first time…since I have started this journey, I have finally broken out (a personal breakout) of making some serious progress in a trading method. And you guys probably don’t realize my reasoning for it. See, I can only trade once a day. In the past, I’ve put on trades to only get stopped out, and turn back around. I just can’t interject on the trades throughout the day. Talk about frustration.(And I’ve heard this countless times here in Babypips)
There’s many other reasons.
And I would love to go toe to toe with you guys on them.
Success has been following me lately, and I think it’s because I’m not being stopped out.
Maybe I’m deceiving myself.
But, it’s working. And I must continue this until I see some deteriorating results.
And just so you know, you guys are really the only souls on this planet I talk to regarding anything that pertains to trading.
Continue?
Or let it go…?
Mike
Of course continue. We respect the way you trade Mikey. We were just sharing our findings.
Rookie, I closed at the bottom on Friday at -8pips , it was just luck, nothing to do with experience, fact is I was gambling and knew it (post 3473), also knew that German numbers were up on Monday early and figured they would be positive (post on Newbie Island for reasons)
All that coupled with the fact that price couldn’t stay below 1050 meant there were buy orders lurking - my loss could have been any number - just good luck.
So the plan was to buy EURGBP, and hedge it with a slightly smaller position of EURUSD short. The long was on the 4HR. The EURUSD short was planned to be on the 1 HR so you can try to capture the pull backs. However things did not go to plan. Luckily the trade so far is still a winner. But there is something I learned and I thought you guys would like to hear it.
So here is the trade. I entered at the close of the candle marked with the green arrow. What I want to point out however are the two black trendlines ; one on the bottom left and the one to the center.
The one on the bottom left measure the move (let’s call it move 1) from the lowest close to the highest close. Then that trend is taken and applied to where I entered. The idea here is to say: "ok compared to move 1, how is my trade doing? If its better the candles will be above the trendline, if worse it will move below it. The idea was that once it closes below the trendline, I should look to short EURUSD. So you can see that candle 9:00 UTC closed below the trendline. That means that I should have shorted EURUSD at 13:00 UTC.
So here is the 1 HR chart of EURUSD. The vertical black line is where, based on the first chart, I should have sold Euro. But as you can see euro did not fall at all. Luckily, I trusted my indicators which showed EURUSD was bullish. Perplexed by how I was caught up in this strange situation (half a position that was giving up its gains), I first bought EURUSD to be stopped at break even. Then I sold it, only to be stopped at break even. Well it was because I didn’t listen to FE’s advice I deserve it 
So you can see that at 13:00 GBPUSD was beginning its rally, which would have been the right hedge. This is exactly what FE warned me of. I had a very challenging week as a result of not listening to the advice.
So What Did I learn This Week
The first lesson was to always consider my friends advice. The second one in terms of the hedging idea, is to always make sure you traded all the possibilities. This can happen if, after picking a pair, you select a third currency that acts as a denominator. After that you aim for winning the risk to reward (which for this idea to work has to be more than 2-1, or all three trades if possible.
So for example let’s say next week I trade USDCAD long. I need to hedge it by buying CAD as well. So lets say I decided based on my system that EURCAD short would be the best option. Now I have to buy EURUSD as well. This way, I chose Euro as the denominator between the USD dollar and Canada and now I win whatever happens if my reward-risk is higher than 2-1.
So imagine I set a stop loss for USDCAD of 100 pips and a target of 210. I also set the same target for EURCAD short and EURUSD long. Now all were given the same lot size and I lost two trades (which should be unlikely) and won one. The result would be 210 - (100+100)= 10 pips in profit.
