I will use either 1 candle or 2 candle method, which ever works to get me in when I want to get in.
Great minds think alike. Writing up recaps of trading plans and late entries now.
OK, Here goes. Never written one of these before, so cut me some slack, compadres.
USD JPY Trading Plan - May 6 2010 (GMT+8)
Long Term Trend:
Review of Monthly, weekly and Daily charts using Linear Regression channels shows that the downtrend could be ending in a breakout that commenced in late 2009. Daily is bouncing off the upper BB heading down.
Medium Term Trend:
H4, H1 & M30 are all in down trend, hence this is deemed to be an opportunity to take a medium term short position.
Strategy:
• Enter short on retracement to catch the remainder of the Daily chart drop from mid-BB to lower BB near 92.00, some 160 pips.
Tactical Plan:
• Enter short when M15, M5 & M1 are all below mid-BB and stochastic filter clears short entry.
• Set initial PCI SL above high of retracement of 93.99 on the H1/M30 charts.
• As SL in vicinity of Round Number, move SL a few pips higher to avoid stop outs, ~94.05
• 1st target for scaling in is lower BB of M30 ~93.52. Currently around 30-35 pips but may change as BB’s move
• Add additional lots at targets based upon multiples of 30-35 pips. Intend 93.52, 92.91 and 92.61
• Lots are not taken off but locked in with SL when next lot is added
• Manually trail SL for all using STARC band with 2 x ATR setting
• Close all positions before 92.00 (say @ 92.10) since round number will likely act as support for a bounce.
Well Hachiko, having the nerve to attempt this and put it up here for comment tells me you have the nerve to be a great trader. It will take me some time to comment and it’s late here in the energy capital of the world, but I will go through it and help anyway I can.
I’m thankful our chat room has really been a big success with people on almost at all hours. People are learning, asking questions, trading together – and having success!
With your statement above in mind (which I emphasized), I’d like to introduce the next tool in the arsenal. The following is an excerpt from the broadcast message I sent to everyone who so far has registered and participated in the BB DNA chat room. I share it here to encourage others to participate and for folks like Graviton who currently don’t know how to quickly and easily share their forex charts and use them as examples to both ask and answer questions.
Now we do:
I have set up a Vyew whiteboard for BB DNA here: [Bollinger Band DNA Vyew](http://vyew.com/room#/130221/Bollinger_Band_DNA)
Feel free to bookmark this link and visit it whenever you’d like to make a fast screenshot to share with others. You can even keep chat open in one window (or tab) with the whiteboard in another for quick reference.
All parties sharing screenshots and uploaded images can annotate these pages together, dynamically sharing content on a remote electronic “whiteboard” any time day or night. Voice chat and Live Desktop Sharing is now also available there.
For a brief overview of some of what you can do, here’s a link for a streaming video I made illustrating some of the whiteboard’s features: BB DNA Whiteboard and Video Conference preview
So now we have something quite versatile to enjoy: Live sharing of trades, sophisticated chart presentations that are fast and easy to do, and the ability to share voice communication without having to worry about who does (or does not) have certain software installed.
Enjoy!
- John (Merchantprince)
Visit Bollinger Band DNA at: Bollinger Band DNA - FOREX Trading using the Tymen Bollinger Band Strategy
Whew! A busy day in trade chat today, not only were we trading like world class traders, we talked about the necessity of having a trading plan and not deviating from it, detailed in a previous post, and we also talked a bit about entering a trend late.
The problem is, we all have to sleep sometime, and it seems that no matter what your time zone, the best trends will start while you are having sweet dreams. So you wake up early and EURUSD is dropping like a rock and you have no hope at all of getting a good 1H or even 30M BB DNA CBL entry. What to do? Well, you can sit there for hours watching it drop, hoping for a retracement to enter, and never get one, just jump in and get stopped out by the retracement you wanted in the first place, or you can get creative.
To start with, you have to realize that there is no method to enter an existing trend with as little risk as a good BB DNA CBL entry from your home chart. But you don’t have to take crazy risk to get in either. Having carefully analyzed the pair you intend to trade gives you a big advantage in deciding if this is really a trend you want to trade. You want to control the risk of entering a trend already in progress, but it will be risky.
First of all you need to get a good idea of what size retracement you can hope to catch to get into the trade. Starting at your home chart and working down, you can see retracements that have occurred while you slept soundly. As you get to shorter and shorter time frames, larger retracements will occur more often. Your best odds of a good entry is to catch a regular CBL entry off the highest time frame where on is likely to occur in a reasonable amount of time.
This morning I wanted to enter the eurusd after it was already in an established down trend. I wanted to get in because after detailed technical and fundamental analysis I was convinced the pair would continue trending downward. After studying the charts It was clear there would be no entries for some time on the 1H chart, or even my usual minimum for taking these entries, the 30M chart.
Tymen has said his CBL works on any timeframe. The only reason he recommends using it on time frames of 20M or more is to have enough room between the CBL entry and the mid BB to make reasonable pips. So basically, the CBL entry technique works on any timeframe, and the lower timeframes will offer more entries. So I looked closely st the 15M TF and there was not likely to be an entry any time soon there. I then went down to the 5M TF and I could see retracements were happening often on that TF. I only had to wait about 30 minutes and a valid CBL entry was obtained. Due to the strong down trend, that entry turned into a downward BB walk and I was able to move up to higher TF’s to manage the trade.
I would have preferred to get a higher TF entry, but not even the 15M time frame wasn’t offering CBL entries this morning, so I was left to either take a good 5M CBL entry, take a cbl mid BB entry off the 15M chart which would be just as risky, or just sit out the whole down trend. This time the good CBL entry worked. The next time I may get stopped out. Maybe I’ll be stopped out the next two or three times. The point is, if the trend is strong enough, the entry is a good CBL and I’m using my 5 lot system, I could get stopped several times for 25 pips, but the one time I catch it I can make 300 pips, more than making up for any failed attempts. And that’s what happened.
So, the combination of a very good entry technique the BB DNA CBL, a very strong trending pair EU, and a positioning system designed to maximize the profits from a long trend the 5 lot system, yielded a 1:12 risk reward ratio. With that sort of R/R ratio, even a W/L ratio of less than 1 can be very profitable. This is how the big pips are made. Small losses are accepted as a consequence of setting up the opportunity of making much larger returns. Minimizing the risk as much as possible and taking this risk only in the most advantageous of situations is key to success. In this case, the opportunity came in the form of a trend that started while I was comfy between the sheets.
[B]Postscript warning:[/B] This is one of those techniques that can blow up an account if abused. The W/L ratio of this technique will be very low compared to other Tymen entries. It should only be used on the strongest of trending pairs and then every possible effort must be made to control risk. As always, any new or risky technique should be carefully back tested and demo tested before being used in a live account. This type of trade cannot be successful without careful analysis and chart study in advance. Results of taking these trades should be logged and evaluated. If they don’t work for you, don’t take them.
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USD CHF Trading Plan - May 6 2010 (GMT+8)
Long Term Trend:
• Review of Monthly, weekly and Daily charts using Linear Regression channels shows that the downtrend ended in a breakout that commenced in Nov 2009.
• Continued uptrend from that time.
• Daily has formed an extreme candle on the upper BB.
Medium Term Trend:
• H4, H1 & M30 have all formed extreme candles, with an evening star on H4.
• In H1, PA has moved off the outer BB and is ranging towards the mid BB in a narrow channel at a slight down angle. This is the 3rd time this has occurred since May 4, 2010
• M30 shows the decrease in PA volatility causing a contraction (squeeze) on the BB. PA moved upwards from the entrance of the squeeze and crossed the M30 mid BB
• This is an opportunity to wait out any Counter Trend PA should a CBL be broken on a retrace from the M30 outer BB in the squeeze.
• Should no CBL be broken, and PA continues to rise through the squeeze, the uptrend would have resumed and an entry can be made based upon the M15 extreme candle and associated CBL at GMT 0245 May 6 2010
Strategy:
• Enter long on a lower TF as the uptrend resumes near 1.1182 and ride the PA by increasing TF as it walks up the outer BB until next major resistance zone around 1.1711 for around 530 pips
Tactical Plan:
• Ignore any short trades of the top BB of M30 or M15
• Enter long when price penetrates extreme candle CBL on M30 or M15 using standard BB DNA rules
• Set initial PCI SL below low of retracement of 1.1151 on the H1/M30 charts.
• 1st target for scaling in is 4 x ATR from entry. Currently around 60 pips but may alter as PA volatility changes
• Add additional lots at targets based upon 4 x ATR from previous entry. Assuming a 1.1180 entry lots will be placed at 1.1240, 1.1300, 1.1360 and 1.1420
• Lots are not taken off but locked in with SL when next lot is added
• Manually trail SL for all positions using STARC band with 2 x ATR setting on M30 TF
• Only close all positions on a retrace to SL
I have taken this trade. See attached chart from Live account. Blue arrow is buy order at 1.11892
42 pips up as I write this.
hi hachiko,
can you please explain why you have choused to buy. I see extreme candle has touched the Upper Band. Is this not a signal for short?
Didnt you put OCO order for buy at upper band and another one to short at lower band?
Good question RenaLa;
In my trading plan I stated I would not take any counter trend shorts.
You can see that at 1200 GMT the candle didn’t actually touch the lower BB.
As there was no extreme candle penetrating the lower BB on the M30, I based the buy decision on the hammer at 1030 and the 2 candle doji star which closed at 1230. I waited for the next candle to close to confirm a bullish pattern and entered. At the time of entry it appeared as if the PA would continue on up the upp BB. Candles from 1300 to 1500 were not there as yet.
Just so happens that PA bounced off the top BB and gave us a little squeeze before heading up. (Don’t worry, I did take the squeeze trade in another account for 11 quick pips to TP1)
As my SL was belwow the prior support level, I chose to ride through the slight bump.
you did your decision on these small doji candles. Hmm its interesting. If the market is weak (I mentioned its usually at the squeeze or right before ) I don’t pay attention to them. But I may need to.
Also I figured out that the price will go to the opposite direction of the band which has no touch of candle. But it still need more testing to state it as a rule.(its may be wrong)
I took short trade today USD/JPY at 30M squeeze I chose to ride throught the support level which I drew on the Daily chart and it execlly was the level where the price bounced off. I didnt miss any single pip. 
No, not the doji alone. I based it upon thehammer, the subsequent doji and then two more bullish candles to confirm the reliability of the pattern. A hammer or doji by themselves are so common as to be meaningless without confirmation.
whats going on with the pairs? Its felt as the second wave of crisis since 2008
:rolleyes:
NEW YORK (Dow Jones)–The euro dropped to fresh 14-month lows against the dollar Thursday, and the yen surged as investors fled riskier assets over concerns that sovereign debt problems could engulf the weaker euro-zone members.
Volatility approached levels not seen since the height of the financial crisis in late 2008, with the yen rocketing higher against the dollar and euro as U.S. stocks plummeted. The speed of the stock market’s decline was breathtaking-—at one point, the Dow Jones Industrial Average was down nearly 1000 points before recovering partially to end the day with a 348-point loss. Worries about the spreading debt crisis in the euro zone slammed investments across asset classes: Investors who had borrowed in low-yielding currencies, such as the yen, were forced to unwind positions rapidly, which pushed the Japanese currency sharply higher.
Concern that a sovereign debt crisis in the euro zone could spread across the region’s periphery has moved from hitting just the common currency and government bonds to all asset classes, said Sebastien Galy, currency strategist at BNP Paribas in New York. The panic washing over the market is forcing a “massive deleveraging,” he said, turning the contagion worries into a full virus.
“It’s similar to what we saw in the Lehman crisis,” Galy said. “We’ll probably get very massive jumps, very, very fast.”
It’s too soon to say this event could turn into a full-blown credit crisis, something the collapse of Lehman Brothers helped spur, he said, but some lenders could be reluctant to lend until they determine who has been affected by these steep moves.
Late Thursday afternoon, the euro was at $1.2599, down sharply from $1.2816 late Wednesday, according to EBS via CQG. The dollar was at Y89.92, well below Y93.66, while the euro was at Y113.26, down from Y120.12. The U.K. pound was at $1.4832, down from $1.5103. The dollar was at CHF1.1123, off from CHF1.1172.
The ICE Dollar Index, which tracks the greenback against a trade-weighted basket of currencies, was at 84.910, up from 84.102. The index spiked above 85.000, to its highest level since April 2009, at the height of the afternoon risk selloff, before riskier assets staged a slight rebound.
A break below the 100-day moving average in the Standard & Poor’s 500 index, which traders put at 1145, helped trigger the “total collapse in the risk trade.”
“It’s capitulation,” said Brian Dolan, chief currency strategist at Forex.com. “It takes on a life of its own” as investors add to a stampede to safety. In October 2008, the euro dropped 9.60% against the yen from its daily high to daily low; Thursday, the euro dropped 7.92% against the yen from its high to low, according to data compiled by Dolan.
The euro had earlier fallen sharply after European Central Bank President Jean-Claude Trichet offered few words to soothe investors’ nerves over the possible spread of Greece’s debt problems to other euro-zone members struggling with deficits such as Spain and Portugal. Also, Moody’s Investors Service warned that European banks could be affected by the Greek banking system’s woes.
Trichet failed to offer any new initiatives to address the euro-zone sovereign crisis during a news conference following the ECB’s regular interest-rate meeting. As expected, the ECB left its key interest rate steady at 1.0%.
The U.K. pound also plummeted as voters went to the polls. Fears of a possible hung Parliament shadowed the currency, with sterling down nearly 2% against the dollar on the day. Investors will await Friday a resolution to the election; a strong showing for one party could help sterling rebound, analysts said.
Separately, the Swiss franc soared to a record high against the common currency, with the euro plunging to a fresh record low at CHF1.4005. The Swiss National Bank appeared to be abandoning its efforts to reel in its currency’s strength as the franc abruptly soared against the euro.
Meanwhile, the dollar could gain even more should Friday’s nonfarm payroll numbers show the expected gain in jobs, strengthening the idea of the U.S. economy recovering at a pace more quickly than its peers.
With the ICE Dollar Index strengthening, Deutsche Bank’s PowerShares U.S. Dollar Index Bearish exchange-traded fund was down 1.04% from late Wednesday, while its PowerShares U.S. Dollar Index Bullish was up 0.82%. The two exchange-traded funds are based on Deutsche Bank currency futures indexes, whose composition mirrors that of the ICE’s Dollar Index.
-By Bradley Davis, Dow Jones Newswires; 212-416-2654; (Don Curren in Toronto and Goran Mijuk in Zurich contributed to this article.)
(END) Dow Jones Newswires
May 06, 2010 16:33 ET (20:33 GMT)
Copyright © 2010 Dow Jones & Company, Inc.
Hey guys, as promised, here is the latest MTFTT indicator with colours, bells and whistles!
It’s a little late but I’m afraid I’m quite short on time nowadays.
MTFTT Trend Counter_mod1.zip (1.01 KB)
Thanks for your good work IronHeart. While I don’t believe these indicators are reliable enough to trade on alone, this one may serve to direct attention to a pair that’s trending. Happy Trading
Better late then never, thanks, appreciated.
How many times have you hit buy when you meant to hit sell, or bought or sold the wrong pair? When I do that I cancel it fast and I don’t tell anyone. But today somebody on Wall Street did something similar and it set the world on fire. At the time, all I could think was at least it wasn’t me.
I got caught on the right side of the big trade that followed for the wrong reasons. After seeing live coverage of riots in Greece, I went short euro pairs and long USD pairs. I can’t explain why. It just seemed the right thing to do. Then the market went crazy and I was a very busy fellow for for about an hour. I didn’t have time to look at charts, I was putting on lots and adjusting stops as fast as my mouse could move. An hour later I was flat with all lots closed out and the biggest one day total pips since I’ve been trading Forex. Oh well, I’d rather be rich than right.
Happy Trading
I heard in the news while at work today about EUR dropping like a rock. I wish I had been at home today putting on some trades.
Now what happens? After hugh drops like this do you still pay attention to the techincal aspects of things or wait until things smooth out a little before getting back into trades?
Who has thoughts around this?
Thanks
Jack
So, now you can bring us all out for a “partay” 