I understand playing S/R to help guide entry and exits, I use USDX this way most every trade. I am simply having a hard time seeing the correlation between USDX and US10yr on the chart.
Thanks again
Bill
I know my opinion is openly degraded here etc but if I may provide you with one piece of advice that virtually everyone here will disagree with…
Don’t scale back your capital exposure on your trades unless you are heavily insecure in your trade idea (in that event, you shouldn’t even take the trade). I know ICT always preaches risk reduction etc, but the reality is that anyone making an above average (i.e. above 50%) win ratio should not cut back their risked amount, but rather keep it constant and focus on making your average win higher than your average loss. I have made massive leaps in my trading since the day I let go of ICT’s principle. Just think, you make a 2% loss, now you’re exposing 1% in order to make back 2%, and then 0.5% to make back 3% if you lose again, and so on, when you could risk another 2% and make back that 2% far easier.
Anyway, take it or leave it I guess! Just looking at your fxbook results I imagine you’d be far higher in terms of ROI if you did that… But not for everyone!
I still can’t grasp the concept of Yields either, for example I have conflicting statements from ICT in my notes regarding Yields:
– “US Yields Increase = Bullish US$”
– “If yields are dropping and one of the 3 yields fails to make a lower low, look for US$ to bounce (vice versa)”
– “As yields are increasing that is bullish for foreign currencies, as they drop it is bearish for foreign currencies”
– “Risk is on when yields are going up and risk is off wen yields are declining because foreign currencies chase yield”
– “Yields dropping is a risk off scenario, meaning we are looking for sells until we see a divergence in the yields”
– “The US$ should be rallying as yields drop”
Talk about confusing! Did I take notes wrong or is ICT contradicting himself? Can somebody set me straight?
From what I understand:
As bonds go up yields go down and vice versa. This is because when bonds are decreasing people are taking money out and selling them at a discount, bonds down and yields up.
ICT shows when 2 of the 3 make a higher high or lower low and the third fails to do so is a sign of a reversal.
Now I can see this happening but I just have a hard time with how to use the information to either initiate or manage a trade.
I personally don’t scale back my trades either. Then again I have JUST gone live and haven’t experienced a series of losses. I actually think the reasoning behind scaling back your trades after a loss is more psychological - You are training yourself not to “win back your losing trades”. I think a large part of your scaling on trades should be based on how you react to losses.
Big swing from 4-4 high to 4-16 low and retrace to 79 percent on 4-24. Heading back down from the 79 percent to the 4-25 low. Just finished making a retrace to the 62 percent level from the 4-24 high to the 4-25 low.
Looking at the Fibre chart for the week we made the weekly low on 4-24 at 8 GMT and the weekly high on 4-25 at 12:30 GMT. Taking a fib from that low to that high we just made an OTE late yesterday/early today for a possibly run to 1.31300 range.
If my analysis is correct then I should be looking for a retrace to the 1.3001 area for an OTE to go higher right around London open.
Bill, in one video ICT was talking about a recent trade, he was talking about his reasons for entry - he then said ’ and the kicker was the usdx triad divergence’ - he was saying he did’nt use it to initiate a trade, he used it as confirmation of the setup - it’s a great confirmer or heads up of change ahead.
Current example - us10 yr up at pink line - possible bounce down - could be catalyst for bounce in fibre this LO - not a reason for entry in itself - just a possible confirmer, or if 10yr continues to rise, might keep me out.
Hey guys! Sorry I haven’t been around but it’s good to see you’s are still at it.
Anyway, my trading has taken a back seat for a few weeks now and as summer approaches my chances diminish rapidly
So for a while lately I have been thinking it would be great if we could get together some time, actually in person! to exchange notes & experiences. What do you guys think?
You see I’m in a position where potentially I could host a good number of you, possibly up to one hundred & thirty! :eek:
Now I’m not expecting anything like that & would much prefer between ten & twenty for a casual relaxed time where we can get to know each other.
This is all just thinking out loud stuff, but I really want to take my fx experience to another level.
Approximate time frame: Anywhere from November to April, depending what suits you.
Location: Bulgaria, which is very cheap
Curious to here what you folk think?
Keep up the good work!!
– "US Yields Increase = Bullish US$"
yields go down when bond traded value goes up, yield up when bond down
us yields up, bonds are down, money flows out of US bonds, would be bearish dollar and bullish cable/fiber
– "If yields are dropping and one of the 3 yields fails to make a lower low, look for US$ to bounce (vice versa)"
US yields drop and one fails to lower low, the one failing could signal reversal for all 3, therefore could expect yields to reverse up and, see above, USD down
– "As yields are increasing that is bullish for foreign currencies, as they drop it is bearish for foreign currencies"
yes
– "Risk is on when yields are going up and risk is off wen yields are declining because foreign currencies chase yield"
yes US yields up is bond down, dollar out of bonds, flows into shares and foreign currency, risk on. selling dollar and buying foreign currency takes the pair up (cable, fiber). Risk off is reverse scenario, money buys usd, dollar up pairs down
– "Yields dropping is a risk off scenario, meaning we are looking for sells until we see a divergence in the yields"
yes, yields down is risk off, you decide what it means
– "The US$ should be rallying as yields drop"
yield drop is bond up, usually usdx up
to recap, normally:
yield up is bond down, dollar down, risk on, shares up, pairs up
yield down is bond up, dollar up, risk off, shares down, pairs down
otherwise there is a divergence somewhere between bonds, dollar index and pairs
my understanding of it!
I closed all my trades today since its Friday, don’t want to hold anything over the weekend and i’m just about to leave to watch a movie.
I entered at around 1.3015 and closed everything at 1.3028. I felt overly stressed because the consolidation in the 10 yr bonds was too tight and USDX was making higher lows/highs. My SL was 20 pips.
Total for the week was 2.9% with 2 days trading (I went live yesterday).
