The Easy way to trade - John Fox

Trading Discussion Trade Journals
1

Hi Guys,

I’ve been using Babypips as a resource for a while now, mostly for its economic updates calender but I’ve also enjoyed reading through various forum posts and the community feel of the place. Since trading can be lonely boring place, I’ve decided to begin participating and contributing my own trade ideas and methods for the benefit of others.

Here’s how I trade:

I am a Swing / Position / Day trader and in that order. I never trade the lower time frames and prefer to take long term positions over short ones.

I do top down analyse and consider the daily and four hour charts to be the only reliable LOW time frames.

I trade with the trend and overall bias of the market, bias is determined by the use of HH/HL & LH/LL on the four hour chart and by using my eyes on the daily and weekly charts.

I use Japanese candlestick formations on the daily TF to identify reversals/changes in the trend. But only look for hammers, shooting stars, hanging man, inverted hammer, and dojis.

Entries are on pullbacks and with the overall greater trend or on strong reversal signals. Exits are completed when trade setups become invalidated or profit targets are hit.

And saving the best for last, I use support and resistance to identify key entry and exit areas.

Things that I am aware of but don’t always pay attention too:

Currency correlations
Fibonacci
SMA

Things that I am aware of and always pay attention too:
Important economic announcements (most U.S.A reports e.g. NFP, employment, monetary policy notes and central bank rates etc)

Here’s a trade I am currently in:

120413 GBP daily.jpg700×435 33.5 KB

120413 GBP 4hr.jpg700×443 40.3 KB

John Fox (JF)

2

This should be a sticky. +1 on both points.

I consider myself a semi-newbie and my first trade on a live account was on the Daily TF. It won after 2 days.

Often, what “gets” many traders is lack of patience and over-reliance on scalping or trading the below-1-hr charts. This is what screws up money management.

If only people knew what they’re dealing with here, they’d treat the currency markets with a little more respect. It would prevent over-trading and blown accounts.

Even if you make just 15-25 “profitable” pips a day and trade 15 days a month, you’ll be better off in the long run because you can use the power of compounding and increased lot size to boost your returns (At least that’s my trading outlook and understanding).

BTW I like trading the Yen pairs for their volatility and am demo-testing a method based on Fibonacci extensions on the 4 Hr TF to see if it is viable.

The only problem I see on the higher TF’s is drawdown (and maybe, swap interest for positions held overnight and over the weekend). But it sure beats having to deal with the noise, fluctuations and agony of lower TFs.