Thread: Closed: Discuss EUR/USD News with a DailyFX Analyst

I have banked longs at 1.3026 for the night - I had lots of filled lobster pots from fading the descent today and want to switch off for the night completely. It takes it out of you, taking a couple of days off. Not as bigger catch as maybe there would have been but banking profits is the only way to make an income in this game - market will be there tomorrow....again!!

Here in the morning.

Originally Posted by Robert Eckert

Is there some "theoretical" reason why gaps are likely to be closed, or is that just an empirical observation? My naive thought would be that a gap indicates that prices are never likely to go back there again, perhaps for years.

The 'mysterious' part of the 'theoretical reason' behind gaps being closed is that cliche: 'nature abhors a vacuum'.

The mechanical part of the 'theoretical reason' has something to do with order flow/book mechanics. Orders (of usually big players) are left in various levels that need to be filled in the process where price moves back and forth. A gap, be it physical gap or liquidity gap, leaves a lot of orders in either directions at certain levels unfilled. Brokers/market makers would eventually move things around to make sure everyone is happy. Some gaps are closed fairly quickly within 24 hours or a few days, some might be left there for much longer time depending on the strength of a trend.

i find failure essential in trading. if i didn't have 50% of my trades failing i couldn't have the other 50% succeeding.

reading a few posts and I think it is time for me to share my advice and experience. 1) Never ever use your margin call as a trade stop-loss The market will always find a way to take you out. 2) if you are day trading build on a specific position ie add to the position as price allows and always move your stop to break even...... and again if you get greedy and put your stop loss in the money to quickly it will always take you out. Just my experience and advice kudos everyone!

Here r some of the questions every trader shud ask himself,


Do u ve a Trading Method?
Do u ve Trading Rules?
Have u tested your trading method to the maximum?
R u Disciplined enough ?
What kinda trader u r?
Do u emotionally get attach to ur trades?
Your successful trades r the result of ur analysis or is it just a guessing game?


some things one shud learn.....
Stay focused on wht u need to learn
Dealin with losses, ( loose but don loose ur pants, never risk more then 1% on any given day)
Believe and learn about ur trading style,
Monitor urself ( write a trading journal )

and treat Forex as a business or like any other 9 to 5 job, where once u r at work u must do ur work, tradin from home doesnt mean u r not workin. u must ve passion for forex,
discipline without goal is useless , so better define a realistically real goal where u see urself after one year. Nothin in this world can take the place of persistence,
and last but not the least....
Take out all ur s-e-x-u-a-l energy n put it into ur work n ur work ll become S-E-X-Y....

i hope it can help...

~ chaudhry~

Here is a little vid. Its been a while so enjoy. Maybe you will get a few Ideas from it.



Out come in at the end

Good to see different rules and philosophies been shared today. I agree with most of the stuff being shared and I also want to bring forward this statement.

Originally Posted by jbiggart

i find failure essential in trading. if i didn't have 50% of my trades failing i couldn't have the other 50% succeeding.

95 out of 100 traders I meet (and I meet many traders every year) are afraid of losing - yet losing is a part of trading but people don't want to understand this. As an effect of this many newbies trade very very short term as they "can't stand the heat" they also have very low initial stop loss levels as they have small accounts. They feel that is better to risk 10-15 pips instead of using lower leverage and using bigger stop losses.

Yet the more short term we trade -> price will get more random - there is no doubt that there are traders that are very good at scalping but its takes much longer time to become profitable on scalping than trading with the bigger time frames.

This simple mathematical example shows that you need to be really go to trade with a tight stop loss
The daily EUR/USD range is about 120 pips so if we have a 60 pips stop loss and we enter randomly in line with the trend then the probability that we will not have been stopped out and in profit 24 hours later is about 50% - thus we do not need to be experts to make this happens.

However if we have a 15 pips initial stop loss and we randomly enter the market in line with the trend then there is just a 12.5% chance that the position will be open for the next day and a 87.5% chance that we would have lost the 15 pips.

Why? well -> 120pips/15pips = 8 intervals of 15 pips each. Thus we need to be very clever and pick 1 out of these 8 intervals and 1/8 = 12.5% so timing will be extremely crucial - I would say so extremely crucial that the trend will not matter in this case.

So if you have tried it before -> Try to use lower leverage and use a bigger stop loss.

I hope this makes sense.

Originally Posted by Clivewaverider

For such a bowl, might I suggest JM Hurst's : The Profit Magic of Stock Transaction Timing. The knowledge is transferable to forex as it is a core element of my 'wave riding' methodology. The book will not give you the answer to how to trade the waves but it will undoubtedly help you to see that they co-exist on every timeframe - those blessed fractals if you will - and explain a lot of the technical quirks that are often written about here and elsewhere. A very important book for my growth in this career. Trust me - it should suit your way of thinking as the last thing there is in this work is 'magic'.

Here's the link: http://www.forexmt4.com/_MT4_Systems...n%20Timing.pdf

Thank you for sharing. Will take a look.

I agree with what you say below, but also there is a win/loss ratio that significantly increases using scalp strategy. Sure, the timing has to be precise but with your example with 60 pip stop that gives me 4 tries to enter position (with 15 pip S/L), that increases my chances to enter right (gambling is not an option).
Scalping makes sense when bouncing off a considerable line of S or R, TL and others…
P.S. Happy to be here guys so HELLO and have a good trade week!
MAXJOY

Originally Posted by Alejandro Zambrano

Good to see different rules and philosophies been shared today. I agree with most of the stuff being shared and I also want to bring forward this statement.



95 out of 100 traders I meet (and I meet many traders every year) are afraid of losing - yet losing is a part of trading but people don't want to understand this. As an effect of this many newbies trade very very short term as they "can't stand the heat" they also have very low initial stop loss levels as they have small accounts. They feel that is better to risk 10-15 pips instead of using lower leverage and using bigger stop losses.

Yet the more short term we trade -> price will get more random - there is no doubt that there are traders that are very good at scalping but its takes much longer time to become profitable on scalping than trading with the bigger time frames.

This simple mathematical example shows that you need to be really go to trade with a tight stop loss
The daily EUR/USD range is about 120 pips so if we have a 60 pips stop loss and we enter randomly in line with the trend then the probability that we will not have been stopped out and in profit 24 hours later is about 50% - thus we do not need to be experts to make this happens.

However if we have a 15 pips initial stop loss and we randomly enter the market in line with the trend then there is just a 12.5% chance that the position will be open for the next day and a 87.5% chance that we would have lost the 15 pips.

Why? well -> 120pips/15pips = 8 intervals of 15 pips each. Thus we need to be very clever and pick 1 out of these 8 intervals and 1/8 = 12.5% so timing will be extremely crucial - I would say so extremely crucial that the trend will not matter in this case.

So if you have tried it before -> Try to use lower leverage and use a bigger stop loss.

I hope this makes sense.

Originally Posted by turmaz

and one thing more Mr sim!

every body has his/her own risk tolerance, i know my game and my game plan, and sometimes i really change my game plan according to the situation because good players know how to tackle things, and some time very good players take unnecessary risks but when they take this type of unnecessary risks they understands the out come and they wait for the right moment to shot but every shot at the right moment is not necessary a "winning shot"

Good trading is not about being right, it is about trading right.
If you want to be successful, you need to think of the long run
and ignore the outcomes of individual trades.

trade well buddy!

QUOTE]

Hi turmaz, thanks for your advise. Hope u do not get me wrong, I am not trying to challenge you but just try to understand how all of you analyse the data. I saw quite a number of you generate wonderful chart for analysis but till now I still can't customise a right chart for myself.

For time i got the same view as all of you but recently my analysis seem to the opposite all of u resulting having paper loss of -160 pips. Wondering where i have done wrong or something in the chart all of you have notice and I didn't see it.. Maybe can get some enlightenment from all of you guys. Thanks

I'm looking at the possibility of a 2910 area target if we break down and run the 2950 stops. My thinking is it would be a washing before a move higher.

To me the market is spending too much time around 1.3 for my liking. Tells me it needs to go lower, or make an attempt to in order to really break down or stage a violent reversal.

Originally Posted by Alejandro Zambrano

Yet the more short term we trade -> price will get more random - there is no doubt that there are traders that are very good at scalping but its takes much longer time to become profitable on scalping than trading with the bigger time frames.

And also, the 3 or 4 pips of "spread" seem like nothing: but if you do a lot of in-and-out, it mounts up. By accident I have come to be trading in two very different types of style, intra-day scalping on the real account and long-range trading on the demo account. I just do not have the technical "chops" yet to be very successful at the short-term scalping, although I am getting more educated (and appreciative of sharings like Clive's book, thank you). My very best trade was one I actually FORGOT I had made: way, way back there you might find a post from me saying "dollar sucks, euro sucks, time to go long on the pound?" to which a poster replied "time to kill myself" (cable had burned him badly). I bought a bunch at ~1.57, and it piddled around for a long time, and I stopped watching it until-- holy crap-- I saw it was almost to 1.64 and flipped it to short, 600+ pips on the upside and then 250 on the downside, but, that was over a month. Kiwi I bought around 81 cents with a stop-loss at 80 and a limit at 84, and after a while I realized it was never going to make 84 and sold it a bit over 82, didn't flip to short (oh well) but that was nice too, again over weeks; meanwhile in the real account I buy a little kiwi or sell a little kiwi for a couple hours every now and then, and I think the net result has been about zero.

And yes, Paul, I see that the market response is not always "proportionate" to the news; I have seen that both ways, not just major news seemingly shrugged off, but giant spikes after what seems fairly piddling. But here's a weird bit of news: I can't find which Greek politician said this, but the quote was "We tricked the Europeans into thinking we were the ancient Athenians, when really, we are the Byzantines." New Democrats are considering allowing Syriza to form a minority government, by giving their pledge to abstain rather than vote No Confidence on them. This of course is in the cynical hope that Syriza's policies will be disastrous for the country. If the Communists also abstain (likely, although they won't "join"; the Nazis of course are a solid No), then Syriza+Demar+Anel could survive with only 104 Yes votes, with or without Pasok. The neutering of Pasok would be an added bonus for ND, and an outright splintering of Pasok would be their "target 2"; Tzipras would like the endorsement of some factions of Pasok as well as some of the parties who didn't get seats, for the cover of being able to say that his "minority" government was speaking for a majority of the voters. Could be an interesting day tomorrow.

Originally Posted by Fx(MIA)

reading a few posts and I think it is time for me to share my advice and experience. 1) Never ever use your margin call as a trade stop-loss The market will always find a way to take you out.....

I have to admit. I gotta good laugh out of this.

Originally Posted by Sim3

QUOTE]

Hi turmaz, thanks for your advise. Hope u do not get me wrong, I am not trying to challenge you but just try to understand how all of you analyse the data. I saw quite a number of you generate wonderful chart for analysis but till now I still can't customise a right chart for myself.

For time i got the same view as all of you but recently my analysis seem to the opposite all of u resulting having paper loss of -160 pips. Wondering where i have done wrong or something in the chart all of you have notice and I didn't see it.. Maybe can get some enlightenment from all of you guys. Thanks

Post a coupla charts showing where you entered those losing trades mate. Maybe we can show you what you did wrong. Maybe.

desperate times for EUR/USD

Greek Leftist In Spotlight As Talks Stumble - WSJ.com
Greece radical Leftist Syriza party to try to build anti-austerity cabinet - Telegraph
Griechenland: Der Wahlsieger von Athen | Premium-Artikel von FTD.de
Bailout-Hater Tsipras Now Trying To Form Government In Greece - Forbes
Greek leftists in bid to form coalition - Europe - Al Jazeera English
Greek Election Surprise Rejects ‘Barbarism’ of Bailout Austerity - Bloomberg
RPT-Greece's young leftist Tsipras delivers political earthquake | Reuters
Eurozone crisis: Greek left leader renounces bailout deal | World news | The Guardian
Griechenland: Linker Politiker Tsipras will Sparpolitik beenden - SPIEGEL ONLINE
Greek leftist leader lays out radical agenda - CNN.com
BBC News - Greek election: Syriza 'to tear up EU austerity deal'