Trend Interpretation - Am I on the right path?

First off, I respect the emphasis you’re seeking to give to the trend rather than to the swing. Its much more profitable to take a poor signal off a weak swing high/low pattern to get into a strong trend than it is to take a great entry signal into a weak trend.

The furthest back I look in judging trends against one another is 16 weeks. This is too far in some circumstances.

I am these days much less concerned with identifying textbook trends than with identifying tradable trends. And this means tradable according to the rules of my strategy. So my tradable trend has to meet my mandatory criteria: the trend I will get into is the one which meets the highest total of mandatory plus optional criteria. Once I’ve identified a target list of trend sin priority order I will look for a signal to get in as long as not buying at a new high or selling at a new low.

This approach does mean looking over multiple charts though in order to find opportunities every week. I agree with Drekieyja, weekly time-scale is too long for trades and with SimonTemplar that you need to scan multiple charts, not focus on one or two.

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They do say if you put 10 Economists in a room, you will get 15 opinions.

When speaking to “Traders” - the situation is similar.

Personally, i cannot trade the M5, M15 charts successfully, because my head doesn’t have the faciity to work that way. - I can pick tops and bottoms ok, but have proved several times, I get trades in exacty the WRONG direction, often to the exact pip. Now many years after my first trade, I am getting better at it, but would still lose chunks of money most days.

Some people are suited to “Day trading”, some are not - but you are in the best position to know what charts and periods you are comfortable with.
I do recommend that you DO try it when you happen to have a day off though. Either in Demo, or just by writing your bets down on a piece fo paper to start with.

That EURUSB chart is quite useful though and it is one that I use. However, if you move to the daily and look back into last year, what I see is that last week we had a double top and last November we had a double bottom with a retest of the August Lows. (In my view double bottoms and tops don’t have to be exact)

I do recognise that there is a case to be made for drawing a trend channel, sloping upwards for the current period.

My opinion is that we may retest the “double bottom” I just mentioned. That is 400 pips away and allows you to use a stop-loss of 150 Pips or so . Now on micro lots, that would give you a maximum risk of say $15 for a potential reward of $40. [NOTE - I am NOT advising this as a bet, although I am currently trading it on GBPUSD (Demo only) and have been criticised for doing so. ]

Anyway, that bet will cost me around 2-4 pips - whereas if you take 4 bets a day on “INtra-day” and lose 2, win 2 making a profit or loss of 6 pips on each, you will lose 5-8 pips in “Spread” - you have traded 50% but have lost the equivalent of a whole bet just in “Spreads”. This repeats every day. - You need to be much more successful on “day trades” - just to stand still, whereas on longer timeframes your spread costs are much less.

AS a person who works full time, I think your opinion that you should “Swing” are correct.

Your chart may or may not be correct. It is important to understand that your opinion is your opinion. That is what will make you money or cost you money. There is no valid reason for people to say your chart is wrong. The best they can do is present an alternative for consideration.

Last November, I was looking at that USD chart and expecting it to make a double bottom. If you look back - EVERYONE here was saying it had made a “Head and SHoulders” and was a definite down-bet !

Sometimes it is very scary to defy all that opinion and take the “Contrarian -bet” You will be surprised how hard it is and how easy it is to just “Agree” with what all the others are saying. So easy … But remember 95% or more of people expressing these opinions are desined to lose money and many will blow up their accounts comppletely.

SO why do what they do ?

The most important thing I can say to you is YOU decide, You Bet your own opinions. Treat “Consensus” with a huge amount of suspicion.

Be careful mate - you are here asking for “Approval” of your opinion - You don’t need that ! Have your own opinions and trade them. There IS NO “right way” which everyone agrees with because by definition any “waY” whaich we all aprove of, is just plain WRONG !

Not very encouraging maybe - But you’re not here for approval, you’re here to learn how to take money off us !

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hi mate
I’ve traded these pairs for quiet a while

i agree with the majority of what @Drekieyja has said
i also disagree with the placing of that line that he mentioned

you see, the price is now ranging, it’s not in an uptrend
it was ranging,
it took a leg up
its’ not ranging again

you want to do this

  • instead of guessing which direction it’s going to break in
  • you want to PREPARE FOR BOTH

and this comment…

i agree with this 100%
Mate… TEST EVERYTHING

there’s no need to ask us (even though i understand why you did)
Just say to yourself
"ok, i think it’s going up , based on that trend line"
then PLACE A BUY TRADE on demo
and SEE IF IT COMES GOOD

if it wins… Learn from the experience and understand WHY YOU WON
if it loses, Learn from it and understand WHY YOU LOST

Trial and Error mate, that’s all it is
and doing this will fine tune your FOREX GUT FEELING

now. i use that loosely of course
you should never place a trade on gut feeling

but, what i mean, YOUR INTUITION will get fine tuned

the other thing i would advise is this
see your top and bottom Horizontal line that shows the range
GIVE THE PRICE A BIT OF WIGGLE ROOM top and bottom
Dont be so DEAD ON ACCURATE so as to put your line PERFECTLY UNDER THE DOUBLE BOTTOMS OF ABOVE THE DOUBLE TOPS
give it breathing space, like 10 - 15 pips
i mean… this is a weekly chart after all it’s not an M5

now. if you use Weekly, try using other time frames as well to give you confluence

i would suggest

MONTHLY To give you a broader view and to confirm what you think is going on on Weekly
WEEKLY you are obviously trading off this one
H4 to give you a view on the quicker time frame and a bit of a heads up on things
and M1 for entry positions only

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Thanks for the advice guys! You’ve all given me much to think about and consider. Also inspired me to make my first (demo) trade… which stopped out… but it felt good taking that first step nonetheless :slight_smile:

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Good lad - That’s the way to go !

Now did you get stopped because your stop was too close - or because you were wrong ?

You can’t answer that for a little while I know, but that’s the question to ask yourself when the chart gives you the answer :sunglasses:

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hehe
Hey mate… You’ve broken your forex cherry now hehe :stuck_out_tongue:
all that is left is that you go to your broker and create a million dollar demo account
and place a ridiculous trade size like 100 Lots and watch the FAKE MILLIONS (or perhaps $10’s of thousands ) roll in a matter of minutes hehe

i won’t lie and say it wasn’t fun the first time

so… go and do that
and then (after you’re over that)
Come back here and tell me how much fun you had
and then…
we can come back to your jedi training and start taking things seriously hehe

so… on a serious note though
good on you for taking that first step, it is important
be cool dude

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Man, I WISH I had a fake million dollars! Unfortunately my fake wife [Removed for Forums Policy violation]
took all of it when we got our fake divorce :cry:

[Removed for Forums Policy violation]

She sends her best wishes by the way, from our fake Riviera hide-away.

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so… in a way we could say that your fake wife MARGIN CALLED you :stuck_out_tongue: and blew our your account instead of you

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it would now appear, mate, that your fake wife has got you in some policy violation troubles hehe, bloody women… huh :stuck_out_tongue: