Hi rookie,
here is something for you:
Carolyn Wilkins: Monetary policy and the underwhelming recovery
Don’t ask my opinion yet, I haven’t read it either until this point.
Hi Peter,
Thank you for pointing out Flipper’s comment. Knowing when to be aggressive and when to play it safe is indeed an important skill. I think this is what I unconsciously try to achieve by just sticking with cable for the moment. I used to be cautious when winning and aggressive when losing, so I still need a lot of work. Last month I made 50% by aggressively shorting cable, this month however I’m down by 20%. While I’m beginning to get the aggressive-when-you’re-winning part, I’m still struggling with the play-it-safe-when-you’re-losing part. Again, thank you for pointing this out. You, too, are wise (just like FE’s father) 
Hey, the ARC is basically the ATR multiplied by a constant. So you want to set it to 2. You keep the ATR at 7. You can also use the dot as a trailing stop for a different exit technique to the one I mentioned. Good luck.
[B]Mike[/B] keep me posted on your findings regarding the Aussie press conference, AUD just collapsed after it.
Hey guys.
Well first off, Philip, man…I didn’t read the whole thing, but for the most part it was just giving a summary of the world economy. I just didn’t get down to any real specifics about AUD. So, I’m in the dark about why it collapsed. I’ll try to skim over it shortly here.
Anyway…Philip…boy do I wish I was playing for real, on those trades you set up. (sorry I didn’t go with EUR/GBP)!!
Are you sitting down…(1055 GMT)
GBP/NZD—+335
GBP/CHF—+136
GBP/JPY— -3
(USD/CAD)—+154
This is off the charts! Man…why can’t this be October already!!
I hope this isn’t all luck. This is what I am looking for on a monthly basis. But, the down side is I think I would have taken profit after 200 pips. But, I keep thinking this…“as long as I make 200 pips every month, I will be successful, and rich”.
Don’t go anywhere Philip. I’ll need you next month.
Mike
Hey guys.
Well, that AUD write up is called the Financial Stability Review. It’s basically given a broad view of the world economy and their progression.
Hey guys…
FE… I mostly follow bloomberg tv I love their discussions. I find government and public websites to be more reliable AUD data that I put together was from one of these sources. I highly advice you guys to follow bloomberg on fundamentals.
Have you guys found Stevens speech anywhere online ? I checked RBA website so far no updates I’ll get it up tomorrow both on AUD and NZD and … gold a response to an article that Mike linked. I’m on bloomberg surveillance now US segment I might get few ideas from here. Well I actually have found something interesting, the relation between equities market and interest rate. I’ll cover more on those later. I always get excited every single time without a fail and I go thats how I should be trading equities :59:
That was right on time Mike I got you guys covered on that!
See you tomorrow I’m off guys!
Flows, I would say that most of us encounter that very problem. Williams acknowledges that every retail trader will face the scenario of being aggressive during a losing streak.
Lol, he even suggests getting someone who knows nothing about trading to take over and switch off the terminal during such times.
He does urge to be aggressive during winning times.
What I try to do is trade ‘in my head’, not on a demo, during a losing streak I’d be mindful of what I had intended to do - then congratulate myself because I didn’t trade it (regardless of outcome) - for me it feels good when I overcome the trading urge.
Good luck guys - still waiting on Mr Carney - I’m flat at present.
I know [B]Mike[/B]! I entered those a few hours before you and I’m 650 pips in profit (one trade is actually a loser, GBPJPY) That is like reaching your 3-month target in one week. GBP/NZD has been absolutely killing it this week. I’m really upset I wasn’t in it. \
[B]Peterma[/B] The initial reaction to Carney on the chart seems bullish. I will wait for you to fill me in on your take for GBP.
Good luck everybody, I think this has been a good week for everyone so far.
There is something that alarmed me and I’d like to take your opinion on it. Durable goods came lower than expected. Not to mention that the expectations themselves were very pessimistic. Given the very negative number do we now expect a downward revision of US GDP?
Another question, does good number in the continuing jobless claim mean will see good employment numbers in the NFP payroll next week?
Hi guys,
the testing was not started since a long time, it is the second or third week. But the first results are more than promising. It would be great to make a chart of the results. It does look like if we get continuously such results we just have to concentrate on this system and the issue is solved 
Hi Dr. rookie,
I am not sure if you were referring to the report what Mike posted or Stevens speak from today. If it was the second, I can post it tomorrow when I become it.
Good luck to everyone, this time we will all discuss on Sunday our cross-currency COT Index setups and trade it next week. Of course we let Mike on the sideline and congratulate in the end of the week for his discipline Just kidding Mikey, don’t get angry at me!
As Philip says it is a good week, a little sadness is that my awesome S&P 500 got hit two hours ago, it is also a major hit, something had to happen. But I do not try to understand. Peter wrote in his last post about giving to trades to someone who has no idea about it. I agree with him and I do my S&P 500 in this fassion. I do not try to understand it, I have the system and the price goes like it wants until the setup is valid.
Hi Philip,
ok, now I am ready to go, checked all indicators and made all the steps you said. I also put my other system on the chart, one I like the most for entries. We are only looking at two trades you posted (these are the two I also analysed because I saw what you did) and your more complicated entry system gave earlier signals! I have one question though. Do not get very surprised but I never used ATR so I do not know where can I look at the ATR value for the given candle to decide the stop loss.
Looking at the price action I think we have to think about on another exiting strategy. You left way too many pips on the table.
Guys, I am happy that we are getting there. Everyone is taking his role and we are getting better. Show 1, only 1 thread where you see for 3-4 months continuously such a teamwork!
I’m sorry but I had trouble understanding the post. I didn’t understand which trade in particular so I can check the comparison you made.
No I didn’t enter long, main reason was that when the US news came in slightly off Cable could not react, yet USD/JPY reacted immediately, I took that as a sign of lack of buyers of GBP even though there were USD sellers.
I’m actually devoid of any trade ideas, on the one hand the lack of GBP buying today means it’s too early to buy (for me), I also like the USD strength, but is it slightly extended, is there an increased risk of pull back?
EUR/GBP was on the cusp of breaking to the downside today - but it just did not happen, I took a small short position with that in mind (I know it’s the barometer - but it presented the least risk)
Times like this is when I used to force a trade, now I’ll just not bother with the hassle of being on the wrong side - roll on tomorrow, or next week!
Hi Philip,
ok, you are right. Sorry, for me it was too obvious which two trades I was talking about. I forgot that we post quite fast so the posts get lost. Please check post number 1099 and 1100. There I need to know how to calculate exactly the ATR stop loss. Please use the values.
Thanks
Hey guys.
Check this out. I don’t know how literal we should believe this analyst. But, just take a look at the NZD.
RBNZ ready to pull the trigger - Nomura
Do we all jump in on some NZD? Or wait for a pull back first?
There hasn’t been temptation for me so far this month, but, …I’m wondering if this is a chance not to pass up. (you know my patience level has been there for me).
Talk to me.
Mike
Hi Mike,
I talk to you. It is always hard to say what the market does. But I do think the edge is on the short side for NZD at this moment.
I do not understand though something. We might need Peter on this one or Dr. Rookie might find something. The RBA and RBNZ does jawbone the whole time about historical/overvalued etc. about their currency. Now RBNZ might intervene to decrease the value of its currency. So what I do not understand it why don’t they just cut the rates? That would do the job for sure. They have the highest rates, they could cut a little and the exchange rate would fall like a stone.
I am waiting for the opinions. Well in such a situation I guess I am not the right person to ask what to do. I do like still my instinct so I will jump into it. I wait for the weekend and decide how many pairs and which ones do I choose. Good that you attached the report. I read it and now I know what to look for next week for the NZD. The only problem is that the Transaction report mentioned in the article is not mentioned in my forex calendar. I will figure that one out.
Good night guys
Hey guys!
Here comes Thursday.
JPY: +7 -0 0///+3 -0 0
GBP: +4 -1 2///+3 -0 0
USD: +4 -1 2///+3 -0 0
EUR: +4 -3 0///+3 -0 0
CHF: +3 -2 2///+3 -0 0
CAD: +2 -5 0///+0 -5 0
AUD: +1 -6 0///+0 -5 0
NZD: +0 -7 0///+0 -5 0
And we have the Majors taking it. +15.
Once again we just are seeing 2 sides to the market. No Comm is outdoing any Major.
Oh, and the shot. 00GMT.
Ok guys. Bedtime.
Mike
Morning guys!
Here’s what I’ve gathered on AUD
FE… Stevens speech is out already in mp3 format on RBA website
For the first 15 minutes or so Glenn has talked about global financial crisis perhaps one of the worst in modern history and how at that time Australia was at a position where it was able to stay above the water as other developed nations crashed one after another. He then continued it mainly was because how Australia views what capital is and many of the domestic and international Australian firms were capitalized at a level where they were able to withstand any crisis unlike other global institutions. And says there’s much to learn from other nations fallbacks and wary of not to repeat their mistakes if faced with another crisis in the future. And he goes onto to talk about ‘too big to fail’ - how there’s many dimensions and its complex nature in the context of global institutions that are at the brink of failure. Given the complexity of tackling systematic failure of such global institutions there’s much research and testing to be done for a better understanding and to deal in an efficient and sensible manner and should take another few years for that proposal to come in force.
He noted while the issue is complex he expects domestic and global institutions to be independent and not to rely on government while still offering assistant for a better business condition for firms to be able to grow and expand.
This was his response to a question during Q&A session in summary:
RBA held rates at a record low of 2.5 since Aug 2013 to support transition the economy. While this rate cut was supposed to favor economic growth and expansion housing market heated up due to record low interest rate set by RBA - central banks interest rate is a rate where it lends to commercials banks so therefore low interest rate means commercials banks will be issuing loans with lower interest rates as their borrowing interest rate from central banks decrease. And he continues Australian housing market is getting overheated and unbalanced especially in Sydney with majority of the buyers being [B]investors[/B] taking advantage of record low loan rates was a concern.
He went on to say that the discussion is on the way to cool the unbalanced housing market. However he didn’t specify which measures that RBA or policy makers will be implementing. But I suspect rate hike might be coming soon. Obviously if thats the case he wouldn’t want to spill the beans prior such news that would send finally weakened AUD against dollar soaring up high again. He certainly wouldn’t want to be seeing a strong exchange rate anytime soon until the economy stabilizes - while iron ore and key commodity prices are at 5 year lows.
I saw you guys were mentioning the sudden plunge in AUDUSD after his speech, here’s the only explanation that I could come up with. First off he wants both domestic and global Australian institutions to be independent and not to rely on government for further assistance - bail outs and further funding that they shouldn’t be the first option. And he’s outlook on risk is rather conservative as opposed to lets say the US as he doesn’t want to repeat the mistakes that other nations did such as US. And second off he says he’s looking to take measures to cool the unbalanced housing markets he isn’t very pleased to see [B]investors[/B] driving up the housing price to a level that is unattainable given Australias current economic condition. This all is due to record low interest rate set by RBA. Its funny to point out how it was being directed to investors so the first reaction to such news market participants probably assumed there’s going to be capital outflow that was invested or intended to be in Australian property market causing temporary downward pressure on AUD as investors look for a better offer elsewhere. Ans to top things off he’s been talking how strong exchange rate was and how its not helping the economy to stabilize as commodity prices lower. Barclays currency analysts expect AUD to hit 89 cent that there’s still more room to the downside.
To sum it up I don’t necessarily think RBA will introduce another rate cut with current levels already at record low and exchange rate has weakened quite a bit. I just don’t see another rate cut as being the next logical move in the case of Australia especially given overheated housing market same goes for New Zealand FE… I don’t think they will introduce another rate cut as both are struggling with overheated housing markets. But there’s more ways to tackle this other than raising interest rates which I suspect Glenn is looking to implement soon I’m assuming he’s giving it some time before raising rates from record low level. To back that up here’s what NZ has done in a similar situation - NZ introduced mortgage lending restrictions last October to cool the property market. Annual house price inflation fell to 6 percent since they were introduced from 10 percent in September 2013. I think its rather logical to assume rate hike might be coming soon perhaps after the measure to restrict housing loans sometime next year ? watch out for AUDJPY guys… I will be! I don’t feel good about shorting AUD , given all this and my intuition tells me don’t so I’ll only be looking for a stronger AUD before I go long.
I’m no expert and no one really is in this game however smart they maybe so dont be too quick to jump on any conclusion guys before we see something tangible unfold - indicator and sentiment.
I’ll be back
Ok FE you’ll notice on the pictures you mentioned that the ATR had a value of 0.0019 and 0.0029. That means 19 and 29 pips respectively. You want to multiply those values by 2 to get your stop loss in pips. You can then position size your trades accordingly with your risk management trade. You can go to the baby pips position size calculator and they’ll do the work for you.
If you want the method of finding the ATR value in the future here is how to do it: The ATR value is usually mentioned in the following format: “0.0000” The fourth decimal place is where you start counting 1 pip. So 0.0001 means 1 pip and 0.0002 means 2 pips. So if you see the number starting from the third decimal place then you have a two-digit pip value, like 0.0019 and 0.0029. I hope this clears the picture.
The only exception to this rule are the Yen pairs. The value of 1 pip in Yen pairs start from the second decimal place. So 0.0100 means 1 pip and 0.0200 means 2 pips. 0.1000 means 10 pips and 1.000 means 100 pips.
One cool trick that I like about volatility stop (which uses ATR as well), and I’ll repeat it so its clear, if you look at the second picture you’ll notice that the green dots went up as the price went up. You can use those dots as your trailing stops. So that once price closes below the dot (and in that case the green dot will turn to red and move above the candle) your stop has been hit.
Let me know if I didn’t explain something clearly.
I have a question for you though, you said in your post that “the more complicated system got earlier signals.” I just didn’t understand this part so please explain it to me