This is how you make money in Forex

Wearethechamp · January 12, 2016, 7:21pm

Hi,

Are you able to share which of your identify support of resistant area?
Apologies im newbie.

If have useful link for identifying s/r will be grateful.

Wearethechamp · January 12, 2016, 7:27pm

pipdawkter:

I am fine if other people post their own setups, whether it be Forex or something else.

Here is my next entry. I’m sticking with GBP/USD sell as we had a breakout candle through a support line. You can see in the zoomed out picture that this support line was drawn from quite a while ago. Price had not been this low in quite a while. You can also see from the zoomed in chart, where I entered the trade and where the stop loss is. A safer play would of been an entry about 10 pips below the bearish red candle, but then the stop loss would have been around 140+ pips in order to keep the stop loss above the bearish red candle. That is why I placed my entry about half way up the bearish candle. Now my SL is only 65 pips. Price went up and triggered my entry, and has now started to come down. Lets hope it continues down.

You can’t see where my take profit line is in the picture, but it is about 250 pips profit or so I believe. I may change this over the next couple days and will update the thread if I do. So I risked 3% with a Stop loss of 65 pips. So if I gained 250 pips, then it would be almost a 1:4 RR, and I would get just under 12%. Technically 65 x 4 is 260. So, just 10 pips shy of 12%. In comparison to if I went with the safer entry with the 140 pip stop loss. In this scenario, it would take 280 pips just to get a 1:2 RR. That is why I like playing the entries half way up the break out candle such as I did here

Apologies for my newbie question.

I would like to ask why is the reason you used these blue circle to draw S/R?
And why isnt the red circle point?

And your entry point of the pair is in 6 years low. May i know how you identify that the price level break through the support line and decided to go for a short while its in the 6 years low?

Thanks if you can clear my question.

pipdawkter · January 12, 2016, 8:57pm

Hi Wearethechamp

All of the blue circles are part of the downward trending channel. My first trade posted on this thread was a sell once it broke down below that channel.

As far as the 3 red circles. All 3 of the red circles are S/R lines. Maybe it is hard to see on my chart, but I do have a S/R line drawn for that bottom circle. My most recent trade that is still in progress was a sell after price broke through that line which was support (where your red circle is drawn). That is all the trade was… a breakout trade. The other two red circles are S/R lines. I just don’t have them marked on my chart currently. Sorry for that confusion. If there is anything I didn’t answer, let me know

Wearethechamp · January 13, 2016, 5:46am

Hi,

There must be some basic behind the S/R lines. Why did you connect only these blue circles as your S/R lines?

And not the red and blues? or maybe only blue?

As my understanding, short term S/R line is better to trade rather than long S/R lines.

Im still blur on identifying S/R lines.

Sorry to cause your inconvenience explain.

Thanks in advance.

pipdawkter · January 13, 2016, 9:02pm

I just don’t have some of them marked out of laziness as I redid my charts at the start of the new year. If price starts moving toward them then I will add them in. Currently it doesn’t make a difference if they are drawn or not

identifying S/R… I just draw lines at areas that act as support or resistance such as on my daily charts. Not sure how else to explain that.

pipdawkter · January 13, 2016, 11:39pm

Well, we are still in the GBP/USD trade. Up about 180 pips for approximately a 9% gain. Stop loss is at break even. We have the bank of england rate decision in the morning which could swing this trade either way. Will probably go ahead and move my stop loss to 6% profit (about 120 pips) tonight before the rate decision

pipdawkter · January 14, 2016, 9:19pm

Trade was stopped out today at +155 pips (chart below). Just over 6% profit. That is a 1:2 RR. Probably a poor decision on my part of moving the Stop loss to 6% as the GBP rate decision was a little dovish and I would now expect price to continue down. But there was a pull back which stopped me out. O well, live and learn. Overall, in the past 2 weeks I have taken two short positions on GBP/USD. Both winners for a 15% account gain. Hopefully I will be entering another trade early next week. We will see what the charts do.

LyorCohenofDiorHomme · January 16, 2016, 7:20am

Hello Guys,

I was wondering whether you could help me clarify something about the forex market. I have devised a strategy in which I’d open an account with $1,000,000 over a period of 10 years - and gain 26% per month from the strategy I want to implement which involves compounding. If this is possible it’d mean in 1 month, my account would have moved to $1,260,000 - and at the end of that 10 year period (120months) I’d have made $1,107,810,339,213,200,000. And from the research I’ve made - it seems to me that the forex market is very profitable achieving a $5.3trillion daily turnover.

I’ve only tested this strategy on paper not physically on forex trading accounts but before I do that I’d like to know the possibilities, whether it’s possible to achieve this remarkable feat - on paper compounding it appears like it is but realistically speaking, taking out the “Everything is possible” It’d want to know whether it is or not. If yes why? Or if no why?

It’d also like to know the possible likelihood of become a forex millionaire, billionaire, etc. I’m really keen in the forex markets and I’d say I have the adequate knowledge to start trading - but there are just some things like this that I’d like to realise.

Please I’d welcome fully elaborated answers as I’d need to understand it step by step

Thank you