After reflection I have decided to change my first post to more reflect my Forex Trading and what this thread is all about. This thread is not for any other traders from newbies and up the experienced line. This thread is for me: a written journal of my thoughts, approach to forex trading and experiences that I can refer to. I often use other traders writings and video’s to illustrate my thoughts, approaches, likes and dislikes. However, I’m not promoting any other service, product or coaching that anyone is offering.
I welcome any comments as long as you keep them respectful. If you have a question ask it, if you disagree with something that’s okay, post your thoughts. I think a retail trader can be successful retail trading in the forex. That doesn’t mean that I think trading in the forex is simple or easy. It’s not and I believe to have any chance trading against: other traders, algorithms, banks and just about anything you can imagine that have one mission in mind to cost you money; and make their profit at your expense, you have to take advantage of opportunities when they present themselves.
To take advantage of opportunities, you need to have a strong understanding of the basics of retail trading in the foreign exchange and from that build a strategy based on the type of person you are, your personal finances, support and goals. A strategy may consist of different trading methods, financial management and goals; again depending on you the trader.
I think of myself as a short term opportunity trader. I trade on the 5, 15, 30 and 60 minute time frames. I believe the longer you stay in a trade the more risk you’re taking on. Again my opinion, not parading as a fact. I know other traders that believe you’re better off staying in the trade longer; you have to decide what’s better for you your situation and goals. For me it means short term not trying to pick tops and bottoms but profit areas with less risk protection.
Direction has to be the same on all 4 time frames, my broker offers 80 pairs of currency so I start with the majors and move down the line, until I find one that matches the same direction in all 4 time frames. I only trade the market overlaps. 90% of the time I trade London/New York overlap, but I will also trade Tokyo/London and on occasion Sydney/Tokyo. Don’t normally hold over night and even less over the weekend. At the time of execution the trade will have besides entry, a trailing stop, a fixed stop and potential profit areas. I use alerts to tell me when price is approaching the above points. I do not trade before the market overlap or during any economic events. That does not mean I don’t trade the news, it means that after all events have happened, and how the affected market price that’s what I trade on never upcoming events or Central Banker announcements. I apply a theory promoted by Richard Wyckoff. His belief was that the forex market is always in one of four phases, Consolidation, Markup, Distribution, or Markdown one after another in the same order. Once I determine what phase the market is in, I apply a Fibonacci tool to give me entry points, trailing stop loss, fixed stop loss and potential profit targets and confirm phase, Fibonaccci numbers with Support and Resistance.
I apply a theory promoted by Richard Wyckoff. His belief was that the forex market is always in one of four phases, Consolidation, Markup, Distribution, or Markdown one after another in the same order. Once I determine what phase the market is in, I apply a Fibonacci tool to give me entry points, trailing stop loss, fixed stop loss and potential profit targets and confirm phase, Fibonacci numbers with Support and Resistance.
