Thinking INSIDE the box

Beginner Questions
145

I know it’s still a little early to post this since there is still around half an hour to end of play for tonight but I thought I’d do it while I had the chance (youngest child pretty restless tonight)

Sticking with my basic S&R lines I marked the other night, there is still no move out of the range between the first two levels marked.

Going back to something I mentioned way at the start of this, if you did wake up in the box with no concept that what you were actually watching was an exchange rate for two currencies, all you’d be thinking is will Red move lower first or will white move higher?

I tend to like this way of thinking about things now since I personally think it is the concept of ( or at least the very thought of ) these lines representing money which helps most people Royally F*ck things up when it comes to trading. Therefore taking the idea of money out of the equation seems to help, if that is you can maintain that thought pattern.

For all intents and purposes all you know you are watching is the movements of two armies, ie the RED army of USD and the WHITE army of GBP. First yellow line is USD’s first defence line. Likewise first blue line is GBP’s first defence line.

So which of the armies will be first to break through, AND HOLD THROUGH, the others first line of defence??

If one side can do that, is it reasonable to assume they can hold that line? Will the other side try to come back and reclaim that line? And if they fail to reclaim it, will they be pushed further back towards their NEXT line of defence??

146

What’s interesting is how you position yourself for a buy entry … How to get out with a small profit - breakeven when the market continues to go south instead of north !!..

If the price goes north or south is usually a coincidence .
Trick is to position yourself so that you go on a minimal small loss - win ,if the price goes opposite your position…

147

So. In your little game of chart football there, where do YOU fit in? It’s easy to point out lines of “defense”, but how do you use them or any other chart analysis? Do you sell a breakout of the bottom, or buy a breakout of the top? Sit on the sidelines and hope you account grows magically? That’s a big range there. How do you limit risk? Stop pointing out the obvious, and get down to business here. What is going on there on your chart is useless to you without a plan of action.

What is yours?

148

Well… That was effective…

Not…

:smiley:

149

Rather thought that was the point of the “little game of chart football” MasterTang. Looking at the chart for the first time, (either in a box or as a new trader) what would you know to do?

All we have seen so far is that the lines move up from the first blue line and down from the first yellow line. So what is there in that that a new trader should have learned?

Only thing I could take from it so far is to sell when we’re up at the yellow line, buy when we’re down at the blue.

What am I willing to risk on either of those moves?

Drop the chart down to a 1 hour and I find points where the move stalled slightly in between first and second yellow (1-6767) and first and second blue (1-6640)

So only tactic I could take from what I have seen so far is buy at first blue, tuck stop just behind bottom white (1-6635)

OR

Sell at first yellow, tuck stop behind top white (1-6770)

Gives me roughly a 30 pip stop on either move.

Being stopped out on either side would have me thinking the lines were moving towards the second lines of defence.

Other than that I don’t see what else there would have been to gather from what we’ve seen so far, of course, wouldn’t be the first time I was wrong.

EDIT: And sure as God the very second I hit the “Post Quick Reply” button the LO spike down would have blown that little idea clean out of the water, so it would be back to watching and looking for “the obvious”.

150

Master (can I call you Master)?

See the post ref one month hence, then we will have slightly poorer Labour numbers (the govt know Mack is on to them).
That fundie play has been up and down, nothing unusual about cable.

Doesn’t stop me day trading using the techies, or these silly lines on the screen, or Asian order areas or whatever they are.

Now where is price at this morning…hmmm, see it’s down at one of those silly lines that my computer draws for me, German news coming up, methinks maybe slightly negative … all in a days work.:slight_smile:

151

I am no one’s “Master”. MT or Knucklehead each work equally as well :smiley:

Why don’t you draw your own silly lines?

152

Drop so far didn’t quite hit my stop (1-6635) may only be a matter of time though.

A push back up above first blue line though would probably have me hitting the buy button to see if we could make it up to the first yellow line so buy order placed 1-6668, target 1-6730. stop 1-6635.

If the lines drop below 1-6635 before trade is taken in I’ll scrub the whole thing and start again drawing lines.

153

Because the computer can draw starighter than me, also it can think faster than me, actually it’s smarter than me come to think of it.

Btw, for those lurking, I figured the negative news on German mfctr by looking at their most recent export numbers which are down, they are a manufacturing and exporting nation so …absolutely no going long on Fibre this morning before 8.30am for me :slight_smile:

Now cable, my friend, why are you dragging your heels, time to get a move on!!

154

Looks like the battle has stopped for lunch. How civilized

155

Hmm… my computer has drawn another line this morning, at 6685, saying something about a daily PP … oh well let’s see if it can take a deep breath and jump.

156

I know it’s still a bit early but another daily rejection and close above first blue line (1-6665 ish) may have me convinced the line has well and truly been drawn in the sand. Trading back above it for now

157

Yeah. even David Rodriguez figures it has given up the ghost, the weekly PP area is now important, lower highs and lower lows on the hourly … looking for that book again… it’s saying bad things.

Retail sales tomorrow morning, and house resales later for USD.

Market expectation is for a drop, flooding etc etc. Most UK retail sales are from imports, they too are down, (as is usual for Dec - retailers buy Christmas stock from Sep to Nov).

Although all is not gloom - consumer confidence is up, and the flooding makes big news but is unlike snow and frost in that it’s geographical impact is not as widespread.

This yesterday from Markit to give a flavour.

Btw MT, I’m not trying to predict, just in case you are reaching for your cane, I’m just thinking out loud :slight_smile:

BBC News - Markit: Households optimistic about finances in 2014

158

On my phone in the Chinese takeaway shop right now peterma. But you surely must know I’m gonna go off on one about the link you just posted LOL???

160

[I][B]"Households across the UK are feeling more positive about the outlook for their finances than at any time since 2009, according to new research.

The Markit Household Finance Index (HFI) showed that optimism about current finances is also at a high."[/B][/I]

I was going to have (yet) another rant about this subject, looked out some of my best and most trusted swear words, sat down to write it and thought, “I wonder who they asked?”

Did a little digging and found some of the people they asked in the survey and all of a sudden everything sort of…well just clicked.

Seemingly when asked if they were optimistic about their finances, the Beckhams both replied, “Oh we don’t have fiances, we’re married.”

Of course once it was explained to Posh and Dave, Mrs Beckam added, “Yeah, Oi fink it’s brilliant how you an still pick up a Luis Vuitton for less than 12 grand these days.” But with a note of caution she did add, “You do have to be very careful tho’ these days, ah mean, 200 million doesn’t go as far as it used to back in 2008.”

Simon Cowell remains optimistc about his finances saying he honestly believes he can milk AT LEAST another 2 albums out of One Direction.

However it seems that model Abbey Clancey was the only one of the celebrity jollie gang who was not convinced. Miss Clancey in fact stated she was NOT optimistic, adding her grandmother used to read the tea leaves, but she’s never personally spoke to a dead person.

The team taking the survey did actually decide to talk to a random punter on the street, but all she would say was, “You haven’t got any spare change have you? Spare change? What about a cigarette? Any cigs? I’ll give you a bl*w job for a fiver, eh? Any spare change? c’mon mate, don’t be like that, any spare change?”

Fuc*ing Optimistic about their finances…don’t make me spit.

161

So at last we drop below the first blue line.

The Red army of USD has pushed down below the first line of defence for the the whites and they’re digging in to hold their newly acquired premises. Fan-bloody-tastic.

You’d have to think though that the whites will mount an attempt to take that land back, after all it does contain Madame Slacks Wh*rehouse and Whisky Bob’s bar and dental repairs. Since the battle did rage over two or three days however I fear Madame Slacks will just have to remain a fantastic, itchy memory for the white side for the time being, the same cannot be said for whisky bob’s tho as most of the soldiers have no recollection of being there at all anyway.

Therefore, whites to mount an attack and be repelled just short of the line at 1-6660 and being pushed all the way down to second blue line at 1-6616.

Trouble is, playing by the rules of the game, I’m struggling to come up with a stop position which isn’t just placed somewhere for the sake of putting one there. May just put it at 1-6675 for no other reason than only risking 15 pips.

Any better ideas always more than welcome, if the whole thing fails then it’s part of the curve I guess.

162

This is my single biggest nemesis, where to put the stop.

As mentioned, my smart alec computer draws lines on the chart, I have a couple of computers and lately I noticed that they are whispering together behind my back, they are all drawing the same lines.

There are 3 particular lines they keep coming up with, so much so that I had to tell the other half of my brain not to trade through them, even if my super duper trading system is telling me to go ahead.

Those 3 lines that I now hold a grudging respect for are weekly pp, s1 and r1 - weekly pp 6638 on cable this week.

Update: Mr Market has just explained why tight stops and swing trading are poor bedfellows.

163

You have to attach a chart to you thought :slight_smile:

164

ATOS, the private company commissioned by the UK Gov with a £500 million contract to boot as many people off the benefit list as possible, are seeking an early release from the contract due to an ever increasing number of assaults and death threats received by thefe staff.

personally I don’t understand that at all, and apparently neither can Mr George Maynard, the 58 year old epileptic, diabetic chronic asthmatic wbo was recently removed from the Disability list because in ATOS’ opinion he was still fit to carry out “MANUAL LABOUR WORK”.

A bloody good old fasbioned hanging is what we need in this country. Oh, and an economy, and jobs and an industry and a future

165

i would like to ditto all that you have just said. i am 65, brand new to forex even though i have traded stocks and futures in the past. i know that i must be passionate about trading and really stick to it to get good at it. i read alot of motivational books by peale, tony robbins, carnegie, etc. and they do address this very thing. a study was done once and it found that a baby falls 700 times before he or she learns to walk. that is 700 times. the baby gets hurt, cries, but will not let that stop the child from getting up again and to fall again. but all the baby knows is that it is going to walk and nothing is going to stop that. the same applies to anything we pursue. i try to set small goals and that works for me. i write down exactly what i want to do, and exactly when i want to get, then write down what i am going to do to accomplish the goal. i am no expert at this and i do fail at times but this works for me if i really want to do something and focus on it for the duration. i have heard many times that 20% of the people make 80% of the money and if we all had to start from zero again, the same 20% would end up with 80% of the money. these are just some of my thoughts on this subject and i do find it very interesting to discuss. i read all the comments on this and actually learned a little from them. thanks, david w.