I won’t be taking a trades today. I had a good weak and like the note says "Nobody ever went broke closing a trade in profit;"or in this case a session. Today is complete forex diary and analyze trades I took and get ready for Monday.
I hope everyone has a Great Weekend
The Lone Ranger Hi Ho Silver Johnny Depp - YouTube
Have fun! Nowhere to fish in London for me. I’ll probably end up eating fish.
I’m fine with that, I much rather eat fish than catch fish. Find a good place and when I come to London we’ll get together.
Have A Good Weekend
Gp
I came across this video that talks about “smart money” and how they manipulate the forex markets. I don’t like the term “smart money” to me it feels like if we go along with the term smart money, then by implication that makes us “dumb money.” So I will change the term to “institutional money.” What’s “institutional money?” Anything that’s not referred to as Retail money, traders, brokers, strategies etc.
My trading strategy is a mixture of volume, trend and price analysis. With regard to VSA or Volume Spread Analysis I apply the Richard Wyckoff theory. In a nut shell Wyckoff believed the markets are continuously in one of four phases: Accumulation, Markup, Distribution and Markdown. The phases are continuous, and in order. So when the market is accumulating the next phase will be markup, same with Distribution, the next phase is Markdown.
If were only as easy as the above diagram. However that’s not the case in the place I like to call the real world. It’s more like this video below. The thing that almost never changes in the forex is the more you do something, the better you get at it.
Smart Money Forex Strategy - Live EUR/USD Day Trade - YouTube
This video is no different than almost every video or article I use as a reference. The only thing I’m vouching for is the video. Not any other product or service the presenter or the sponsor is selling. The only reason I use other peoples video’s is for the traders like me who learn better by watching instead of reading. After much thought I have decided sometime in the future to do my own video’s and I won’t be selling anything from them. But for now, I will use other people’s videos to illustrate my point. Take Care
Gp
Long on EurUSD. Pretty straight forward. Trending up, no news events scheduled. Green Entries, Turquoise Trailing Stop, Red Stop Gold Profit Targets
Pending Long on gbpusd. My analysis is straightforward VSA. Green is entry, Gold is profit Target, Red is Stop Loss. This are the entries on a 1 hour chart. Stop Loss will go from fixed to trailing at 10 pips profit.
It’s Friday and normally I don’t trade, but that’s not the case today. I’m trying out a new tactic and I’ve been busy working on that. I don’t back test, instead I have several demo accounts and normally I say in my opinion it’s better to set your demo up with the same amount of currency and the leverage you’ll be using in your live account. I do keep the same leverage but I have the max balance I can start with. Then over the course of a week or so, I enter as many trades as I can, and then when the trades are closed I analyze each trade and make notes on whatever tactic I’m trying.
Although I call myself an opportunity trader, most of my trades are done on the 30 minute time frame and I normally take one trade during the London/New York overlap. I subscribe to the Richard Wyckoff theory that the market is always in one of four phases: Accumulation, Markup, Distribution and Markdown and it follows in that same order continuously. So in order to take advantage of other opportunities, I have been working on; 1. trading more than the London/New York overlap and 2. getting more profit out of the trades I do take.
My overall bias is the longer you’re in the market the more risk you take and instead of trying to pick tops and bottoms, pick potential profit. My overall belief is that " Nobody ever went broke closing a trade in profit." When I look at my previous day’s trade, I can see how I perceived the phases the market was in and based on that and other analysis I entered long. Not only did I have the market phase wrong, I almost missed a huge short opportunity. My saving grace was that I had a stop loss in place with a sell short right after it.
I found it’s easier to see the markup and markdown phases than to pick the accumulation and distribution phases. But in order to get the markup or markdown right, you have to know which phase the market is currently in; accumulation or distribution, as markup follows accumulation and markdown follows distribution. So address which phase is which, at the same time getting more out of a trade and trading more than 1 overlap I added this extra step.
Between the Sydney/Tokyo overlap I draw a line on the top of the wick of the largest candle and another line on the bottom of the candle wick. Next I enter 2 pending trades, one 10 pips above the top line, with a stop 5 pips below the bottom line, and a take profit 50 pips above the entry. On the bottom line I enter a short 5 pips below the line with a stop loss 5 pips above the top line and a take profit of 50 pips. I do the same for the London/New York overlap.
There are 5 pre-trade rules.
I am trading gbpchf. I have 2 pending orders. Which ever one gets triggered first, I will cancel the other.
Long: Entry 1.50713, Stop Loss 1.50223, Take Profit 1.51113
Short: Entry 1.50223, Stop Loss 1.50663, Take Profit 1.49873
Rather than mark the chart all up, I leave the chart on the 1 hour time frame with the 2 lines I set my pending orders on. Top line was used for long trade, bottom was used for short. If the pair breaks I will manage it and use the fib retrace strategy as soon as it retraces.
I took 2 trades an hour before London Open, after up and down for most of the session I ended up getting stopped out on both. I re-entered again at the NY open, and been trading ranging markets on the 15 minute time frame 2 many trades to enter. I traded my ranging strategy where I buy and sell between Support and Resistance on the 15 minute chart. I use a take profit and stop loss ratio of 1:2. The gbpcad seemed to be the most co operative so I used my fib tool along with support , resistance and volume indicators to keep the trade going. Entered on the 50% Level Stop on the 75% level and take profit starting at the 0%.
I will be taking a short break from posting trades in my thread. I am combining my range and trend strategies. Purpose is to increase the account balance and make my fib entries more precise, instead of guessing the high and low swings. I’m still around and my analysis, using volume spread, trend and price or any indicators I use to see where the current price, volume and trend are, will not change. So anyone has any questions about what I do, and/or how I do it, fire away.
Gp
I got some questions on whether or not I still use my Fibonacci Strategy when trading when I answered yes. They asked for my rules and an example. So I thought I would revive this thread and post my rules and example as well. I do not use this strategy all the time but I still do use it. So I hope it helps.
Works on all pairs and time frames. In this particular example I’m apply the fib tool to the 30 minute. But works on higher and lower as well. If you use it on the lower, you have to be very careful.
Rules
This trade is going to be potentially on the AUD/USD. Rule 6 outlines trade plan.
I was close. right pair wrong message. I’m setting up a long trade on the USD/CAD. Standard rule six trade plan
That’s it for this week. Start all over again on Sunday Asian open
Gp
At first glance nothing worth looking at. I’m leaning to long AUDUSD but I’m going to wait for Tokyo to open. But for sure have something before London open.
I’m short on EURJPY based on my rule 6 trade plan. In addition I think this pair is in the distribution phase applying VSA which would mean next step would be the Markdown phase. Because of where I’m entering and where I think this could go, I’m using a trailing stop if the pair goes below the 38.2 level.
I rook my reading on the 1 hour time frame, but posted the 30 minute to point out the fib points easier
So far today, lot’s of quantity, not much quality in the London/New York overlap. I’m looking for those entry points between 50 and 63 % levels with no more risk than the 75% level and profit targets from zero plus. So time to exercise a little patience and discipline.
Gp
I’m short on EURUSD I did not use the fib tool. Instead I used a breakout strategy. Pair has is ranging under 60 SMA, on the 1 hour time frame. Direction is confirmed on a higher and lower time frame. So I placed a pending order at the bottom of the range with a take profit target at a previous support level and a stop loss just above a resistance area. Red is stop loss, green is entry, gold is profit target. I want to be in and out of this trade before NY open. I don’t normally trade on a days like this lots of central bankers speaking, but I think I’ll be out before the action starts.
