usdcad buyers may keep buying this week. Look for “discounts” to be snapped up quickly.
Glad to have “sparked your interest”. Calling this thread “fascinating” may be pouring it on a little thick. Nothing ground breaking here. The fascinating part to me is that the majority of traders are not trading in a similar fashion. Instead they are like dogs chasing whatever car happens to drive by next. But as I posted elsewhere, they can’t help themselves because their brains are wired to respond that way and they do not know it.
You can trade the weekly open whenever the price crosses over in the direction of the daily flow. There are always exceptions to that rule but better to pass on those for now. The majority of my trades are long but there are times when I can plainly see going short will most likely result in a profitable exit.
In case you did not read my warning about trading the weekly open - it is extremely boring. There are no cool indicators to look at. You may only get one or two trades per week per pair. Sometimes, you do not get a trade. The upside is, you can make a modest profit most of the time and, on occasion, you can make a killing. If you risk 2% on your trade, use a 10 pip stop loss and have proper position size, a hundred pip win is a 20% return on your account. One or 2 trades like that a month and your membership in the 5% club of successful traders is a “lock”.
From investopedia:
Trend What is trend? The simplest identifiers of trend direction are higher lows in an uptrend and lower highs in a downtrend.
Based on that definition the 200 period trend is up?
Based on that definition the 50 period trend is up?
That does not seem like it would be of use in deciding how or when to enter. Are 2 periods enough?
One period seems absurd but is it?
That assumption is correct.
Have you ever watched the NFL or American football? When the camera zooms in on the coach sometimes you’ll see them holding a laminated sheet of paper with some areas highlighted in different colors. That is the “play book” for that game.
I use a similar sheet for trading. If I am up 10 pips, I know what to do. If I am up 20 pips, I know what to do. If I am up 30 pips, I know what to do, etc… I usually have 2 or 3 options depending on the level. I can exit all or part of the position. I can move my stop loss up or switch to a trailing stop. Which option I choose depends on factors like my current gain/loss for the day/week, time of day, time in trade, etc… I don’t post my play book not because it is a secret but because a trader has to learn to make decisions and learn/grow from their decisions. You can fill in the blanks for yourself:
[B]
I have entered a trade and set my stop loss at ______ pips
I am up 10 pips, I will either _________ or _________
I am up 20 pips, I will either _________ or _________
I am up 30 pips, I will either _________ or _________
I am up 40 pips, I will either _________ or _________
I am up 50 pips, I will either _________ or _________
I am up 75 pips, I will either _________ or _________
I am up 100 pips, I will either _________ or _________
[/B]
Do not let this form or format limit you. You may think of other “plays”.
Hint: Think of each pair you trade as a different “game”.
I don’t have any plans per se. You stated you are new. Exceptions should not even be on your mind at this point. No offense intended or implied.
Most traders and their systems lose. One reason is because they find themselves on the losing side most of the time. Traders talk of “waves”, “trends” and “cycles”. But they never agree on which way the “trend” is moving. One way of winning the game is to only look for one direction. Eventually, you will catch a wave in your direction. Think of it this way, if at the beginning of each day you had to place a “bet” either long or short, how would you bet? If you tried to guess which way it was going you could have quite the losing streak. If you always guessed long, how many losses in a row might you have? Over the last 100 days, the answer is 6. [/QUOTE]
One can not construct an edge, they can only “discover” or “uncover” it. If you “cut your losers short” and “let your winners run”, you can make up your losses in a few trades. Let’s say you started out with bad luck and had 6 losses in a row. If you risked 2% per trade, you are down 12%. If you get lucky on your next trade and hit the 100 pip run, you have a 20% winner and are up 8% overall. And all you did was trade the same direction each and every time. No indicators. No analyzing. No drawing lines. No predicting. No multiple time frames. No anything! Sounds simple, doesn’t it? That’s because it is.
Consider it the art of trading without trading.
The Art of Fighting Without Fighting
In Enter the Dragon, when asked what style he practised Bruce Lee responded with the title of this piece. His reference being SunZi who stated that the ultimate skill in battle was the ability to win without actually having to fight. Gengiz Khan was a master of this having created an aura of invincibility and terror that reduced any opposition to abject fear and thus would surrender without a fight.
The interesting point is that the Khan had to demonstrate his fighting supremacy and utter ruthlessness first before he was able to win without fighting. He wasn’t bluffing and everybody knew he wasn’t bluffing.
Not being graced with the reputation of the redoubtable Khan, or any other invincible warrior, I have nevertheless attempted to follow this path. Although I can fight I really have no desire to do so , which is the antithesis of my position when I was in the flush of my youth.
There is a tale of a lowly Japanese Tea Maker who had the unfortunate mishappenstance of insulting a Samurai. The Samurai demanded satisfaction for this offence and told the Tea Maker to meet him at dawn the next day for a duel to settle the issue. The Tea Maker was terrified but he knew that he had better turn up otherwise there could be dreadful consequences for his entire family. He had never held a sword before so went to a local school and explained his predicament saying that if he was to die he would at least like to hold the sword properly. The swordmaster gave him a sword but quickly realised that it would not be possible to even get him up to the basic proficiency in the time available. He asked the Tea Maker if he could perform the Tea Ceremony for him. Once The Tea maker had finished the Swordmaster told him that he should arrive for the duel just before dawn and perform the Tea Ceremony with the sword by his side so that he could face death calmly and without fear. The Tea Maker did as instructed. When the Samurai arrived he saw the Tea Make performing the Ceremony , considered the situation then turned around and walked away.
The reason the Samurai walked away was that he could see that the Tea Maker had entered that state of being where he was one with the moment and was unconcerned with living and dying. An opponent like this is one to be respected and not to be taken on lightly.
Our aim in Taijiquan is to attain this state where we are at one with the moment so that we can act without thought in accordance with the situation.
It is a truism that if you are afraid of being hit you will be hit. This is caused by your fear getting the better of you , making you tense up and not perform to the best of your ability. Fear of failure makes you worried whether your techniques will work so you either don’t use them or don’t do them properly.
The only way to have confidence in your ability to use your techniques is to continuously practise them in a variety of situations so that they can be used without thought. The mind has also to be trained to remain calm and unruffled under stress conditions and this is aided by the knowledge that your skills and abilities are up to the task in hand.
Thus to be able to win without fighting you must have excellent Kung Fu.
One can not predict the market with 100% certainty yet many foolishly do. Predicting the market is not required to win.
A trader may choose:
When to enter
Direction of entry
Position size
Stop loss
After the trade is entered, one can not predict how far price will go for or against them, yet many foolishly do. Predicting the size of move is not required to win.
There is only one thing a trader has control of after entry is made and that is the their exit order’s location and size. The trader controls the loss or else the market may decimate the trader’s account. The market may or may not give the trader a chance to win. If the market does give the trader a chance to win, it is up to the trader to seize that opportunity.
The art of trading without trading is to put aside one’s thoughts and to execute their trading plan without regard to outcome.
I am not forcing you or anyone else to do anything. What you do is based on your free will. The idea is to cease all thinking. A filing cabinet is not needed, one sheet of paper will do. There is nothing to follow in this thread. There are no predictions here. If reading this thread causes you to have an e[B]pip[/B]hany then by all means share it. Once you have seen the light, you can’t return to the darkness.
If you peruse this forum you will find those who vehemently disagree with some of my posts. Some of those people choose to denigrate me. Do not blindly believe or follow what I or others say or do. Observe, test, research, question, etc… until you are satisfied. Make your own decisions.
Thanks for the well wishes and all the best to you.
I’m drawn to this thread with it’s back to basics mentality reminiscent to that of alternative technical templates and seems to follow a hybrid arbitrary/mechanistic turtles sort of system (although they went for breakouts north rather than swing lows - essentially this falls into the category of bottom picking over a longer time frame). While not disagreeing with it’s viability and it’s certainly not as deceptive as covering your chart with fifty indicators, it still can be deceptively simple to the complete novice. I say this because he would suffer some serious drawdown during times like the recent usdjpy drop or generally downwards spiraling conditions. I’m pretty sure you haven’t purposely written this as a beginner’s guide but out of good will amongst all the KISS you ought to stress that there are certain conditions that will tear them to pieces and that thinking this way is just an (usually) effective means of filtering out the myriad of fundamental factors that drive price action.
That said you draw some very interesting insight and I’ll definitely be keeping up with it
With all of the people who “look out for other traders”, isn’t it incredible that anyone loses?
If anyone reads my posts they will know how to properly calculate their risk and position size so they will never get “torn to pieces” unless they fail to follow instructions.
The weekly open provided 2 trades on the gbpusd. A long on Tuesday and a short on Friday. Nothing exciting.
The weekly open provided 2 trades on the eurusd. A long on Tuesday and a short on Friday. Nothing exciting. Just a couple hundred pips.
The weekly open provided 2 trades on the usdchf. A short on Tuesday and a long on Friday. Nothing exciting. Just a couple hundred pips. The buyers couldn’t resist the sale when it was “under a buck”.
Is this really “deceptively simple”? Seems obvious.
It was a “blue light special” on the usdjpy starting on Tuesday when the price crossed above the weekly open.
The buyers were “exuberant” for the rest of the week.
There was another “blue light special” on the eurjpy starting on Tuesday when the price crossed above the weekly open.
It was possible to make over 400 pips on one trade.
Just to be safe, I’ll post a warning:
[B]THESE TRADES WERE DRIVEN BY A PROFESSIONAL DRIVER ON A CLOSED COURSE. DO NOT ATTEMPT THESE MANEUVERS WITHOUT THE SUPERVISION OF A CERTIFIED PROFESSIONAL. TRADES IN THE MIRROR ARE ACTUALLY CLOSER THAN THEY APPEAR. DO NOT TRADE IN THE SHOWER. NOT TO BE TAKEN INTERNALLY. FOR AMUSEMENT PURPOSES ONLY.[/B]
The long tails on the daily candles show the buyers liked the lower prices.
The weekly usdcad chart clearly shows where the buyers like to buy.
Once again, look at the tails of the last few week’s candles.
When there is a better “sale” somewhere else, the audusd buyers scatter
Interesting Extraction.
I like the sale analogy, or maybe its not an analogy but a real sale. I haven’t decided if focusing only on buying is a handicap or an advantage. I will follow the sale for now. If you get any coupons in the Sunday paper your not going to use send them my way:D
Do you have any suggestions on how to manage this type of trade with pending orders? I don’t have the ability to check in when ever I want.
Assume the previous candle is a big bear with a tail, the current candle is a little bear. The little bear has not gone all the way down to the end of the big bears tail. I am thinking put a pending buy a few pips above the previous days close. How would you determine a stop if you couldn’t be at the screen when the order was executed?
I have been looking at price closely around these times of day but of course I see no predictable range to use as a stop. I am thinking of using the previous candles low. Once a trade is executed a large trailing stop would be put in place until I got a chance to check on progress and hopefully move the hard stop up to break even. If the little bear made it all the way down to the previous days low with out triggering a buy the buy would be moved down to the previous days low. I can check in through out the day to manage a trade or my orders but it is at random times.
Have a good weekend