PP = Central pivot point
M4 = Middle of R2 & R1
M3 = Middle of PP & R1
M2 = Middle of PP & S1
M1 = Middle of S2 & S1
Uptrend
- Profit Target = (Middle of R2 & R1) to R2
- Bottom = (Middle of PP & S1) to PP
Downtrend
- Profit Target = (Middle of S2 & S1) to S2
- Top = (Middle of PP & R1) to PP
Reversal & breakouts tend to occur when london session open/close
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Saturday, 28 August 2010
Wednesday, 25 August 2010
Technical - News release
Traders limit their exposure & a clear range develops days before a major news release.
1. Trendlines to determine prevailing MKT trend
2. 1 piece of news is generally not enough to reverse a clear trend. Do not trade if current MKT direction opposes prevailing MKT trend or news release.
3. Using 1 min chart, enter a trade when price bounce on EMA, Bollinger or Fibo after retrace OR after break of horizontal line
4. Avoid placing stops
5. Take 1st profit at 10 pips
6. Close trade position when default MACD signals a change in trend or 6 pips from critical lines
Sniper trade?
MKT direction is determined by 3 continuous candles on 1 min chart?
Beat the Forex Dealer by Agustin Silvani
- If the US FOMC (Federal MKT Open Committee) interest rate statement was in line with MKT Xpectations, price will return to pre-announcement level. Use 15min chart, identify stop loss level & go along with dealers.
High Probability Trading by Marcel Link
-
.
1. Trendlines to determine prevailing MKT trend
2. 1 piece of news is generally not enough to reverse a clear trend. Do not trade if current MKT direction opposes prevailing MKT trend or news release.
3. Using 1 min chart, enter a trade when price bounce on EMA, Bollinger or Fibo after retrace OR after break of horizontal line
4. Avoid placing stops
5. Take 1st profit at 10 pips
6. Close trade position when default MACD signals a change in trend or 6 pips from critical lines
Sniper trade?
MKT direction is determined by 3 continuous candles on 1 min chart?
Beat the Forex Dealer by Agustin Silvani
- If the US FOMC (Federal MKT Open Committee) interest rate statement was in line with MKT Xpectations, price will return to pre-announcement level. Use 15min chart, identify stop loss level & go along with dealers.
High Probability Trading by Marcel Link
-
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Sunday, 22 August 2010
Technical - Long Candle Strategy
Conditions: Candles with at least 12 pips from previous candle end TOWARDS critical lines (previous highs/lows, round numbers, pivots etc), M5 chart, candle at least 5 pips, candle & wicks more than 10 pips, wick in same direction less than 8 pips, 55EMA same direction as candle
Entry: After retrace, less than 5 same candles (note multiples)
Stop loss: top of candle
Profit target: Price momentum X-over or 10 pips towards critical lines (8 pips for candle opposing direction of overall trend)
wick in same direction less than a certain number of pips indicate reversal?
Candles with at least 1 pips TOWARDS critical lines to exclude wicks?
.
Entry: After retrace, less than 5 same candles (note multiples)
Stop loss: top of candle
Profit target: Price momentum X-over or 10 pips towards critical lines (8 pips for candle opposing direction of overall trend)
wick in same direction less than a certain number of pips indicate reversal?
Candles with at least 1 pips TOWARDS critical lines to exclude wicks?
.
Technical - Unused Strategies
1. http://www.interactivebrokers.com/en/general/currencyHoliday.php?ib_entity=llc
http://www.forexfactory.com/calendar.php
2. Draw lines at Round number
3. Take note of pivots
4. At least 1 primary & 1 secondary signals to open a trade
Primary: Fibo coincide w pivot
Secondary: price momentum X-over, perfect order with 21 EMA slope more than 45 degrees, CCI divergence to reinforce breakout from trendline
5. Stop loss
HT of previous candle, breakout point, 7 pips from Fibo
6. Exit if primary signals occured before secondary signals
Primary: Area of long wicks (3 wicks of more than 7 pips), wicks of 10 pips, 5 pips from trendline
Secondary: previous high/low, price momentum X-over, pivot, correction overlap line
Tertiary: Fibo
M30 new long trend
1. D1 indicates down trend
2. MACD line X below signal line at top of peak (No trading for X-ing near zero line)
3. EMA6 X below EMA23, EMA23 X below EMA50 by at least 30 pips.
4. Sell when
- Price bounces at EMA23 after retrace
- MACD below zero
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http://www.forexfactory.com/calendar.php
2. Draw lines at Round number
3. Take note of pivots
4. At least 1 primary & 1 secondary signals to open a trade
Primary: Fibo coincide w pivot
Secondary: price momentum X-over, perfect order with 21 EMA slope more than 45 degrees, CCI divergence to reinforce breakout from trendline
5. Stop loss
HT of previous candle, breakout point, 7 pips from Fibo
6. Exit if primary signals occured before secondary signals
Primary: Area of long wicks (3 wicks of more than 7 pips), wicks of 10 pips, 5 pips from trendline
Secondary: previous high/low, price momentum X-over, pivot, correction overlap line
Tertiary: Fibo
M30 new long trend
1. D1 indicates down trend
2. MACD line X below signal line at top of peak (No trading for X-ing near zero line)
3. EMA6 X below EMA23, EMA23 X below EMA50 by at least 30 pips.
4. Sell when
- Price bounces at EMA23 after retrace
- MACD below zero
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Saturday, 21 August 2010
Books
Tactical Forex Trading by Wayne Mcdonell
- Minimum Acceptable Performance of USD50 per day is required for me to switch to full time trading as of 2010
- Divergence
MACD shape to be obvious
- If you can only afford 1 lot short trade for USD, check EUR/GBP. If EUR/GBP DN, long GBP/USD.
- EUR/USD is -0.98 correlated with USD/CHF
- The larger the angle & separation between the EMAs, the more favorable to trade and the more likely that critical lines will be broken.
- Speed of MKT also determined by which EMA the price is riding. (5EMA fastest)
Beat the Forex Dealer by Agustin Silvani
- Price spike takes out the stops set below the previous low
- Avoid placing stops close to/at round numbers
- Prices open on Sun NY time in the same prevailing direction as they closed on Fri evening. Direction may be reversed when Tokyo enters the MKT. Trade US pairs only, don't trade AUD or NZD crosses. Ensure no major news release in the weekends.
- Spike lower followed by sharp V-shaped recovery: Don't short
High Probability Trading Strategies by Robert Miner
- Adjust indicator lookback period so both fast & slow lines of indicator reaches OB or OS zone most of the time before a momentum reversal is made. Shorter lookback period will result with momentum reversals closer to the price swing highs & lows but increase false momentum reversals. Don't trade if bull in OB zone or bear in OS zone for higher time frame momentum.
The Nature of Trends
- Sideway Trends: If the MKT retraces less than 78.6%, it will probably continue away from its originating boundary. Beyond 20% of boundary extremes, assume MKT resumed directional move.
- When the MKT accepts beyond A by 20% of A/B, we assume uptrend will continue. However, when MKT accepts prices beyond B by an amount greater than MAX extension, LCC & WPC forms, we assume trend has reversed. For M5 chart, WPC = 3 consecutive whole bars below B from uptrend to downtrend. LCC: +3 = breakout. Above breakout point, +1. Breach against new trend, -1.
- Primary Buy Zone (PBZ) in bull to bear trend: Low of B + (A - B)/8
Primary Sell Zone (PSZ) in bear to bull trend: High of B - (A - B)/8
7 Winning Strategies for Trading Forex by Grace Cheng
- Good bounce opportunity on 3rd or 4th point of contact for gradient of trendline less than 45 degrees with decent amount of open space between the connecting points and moving average slightly below ascending trendline.
- Open long position at 10 pips above hrly candle which closed beyond breakout level
- Place stop-buy entry 10 pips above horizontal resistance of ascending triangle.
High Probability Trading by Marcel Link
- Trade at M5 following H1 trend & stochastics
- ADX rising to 30 suggests breakout
- As volatility increases, stops have to be placed wider or they are likely to be hit
.
- Minimum Acceptable Performance of USD50 per day is required for me to switch to full time trading as of 2010
- Divergence
MACD shape to be obvious
- If you can only afford 1 lot short trade for USD, check EUR/GBP. If EUR/GBP DN, long GBP/USD.
- EUR/USD is -0.98 correlated with USD/CHF
- The larger the angle & separation between the EMAs, the more favorable to trade and the more likely that critical lines will be broken.
- Speed of MKT also determined by which EMA the price is riding. (5EMA fastest)
Beat the Forex Dealer by Agustin Silvani
- Price spike takes out the stops set below the previous low
- Avoid placing stops close to/at round numbers
- Prices open on Sun NY time in the same prevailing direction as they closed on Fri evening. Direction may be reversed when Tokyo enters the MKT. Trade US pairs only, don't trade AUD or NZD crosses. Ensure no major news release in the weekends.
- Spike lower followed by sharp V-shaped recovery: Don't short
High Probability Trading Strategies by Robert Miner
- Adjust indicator lookback period so both fast & slow lines of indicator reaches OB or OS zone most of the time before a momentum reversal is made. Shorter lookback period will result with momentum reversals closer to the price swing highs & lows but increase false momentum reversals. Don't trade if bull in OB zone or bear in OS zone for higher time frame momentum.
The Nature of Trends
- Sideway Trends: If the MKT retraces less than 78.6%, it will probably continue away from its originating boundary. Beyond 20% of boundary extremes, assume MKT resumed directional move.
- When the MKT accepts beyond A by 20% of A/B, we assume uptrend will continue. However, when MKT accepts prices beyond B by an amount greater than MAX extension, LCC & WPC forms, we assume trend has reversed. For M5 chart, WPC = 3 consecutive whole bars below B from uptrend to downtrend. LCC: +3 = breakout. Above breakout point, +1. Breach against new trend, -1.
- Primary Buy Zone (PBZ) in bull to bear trend: Low of B + (A - B)/8
Primary Sell Zone (PSZ) in bear to bull trend: High of B - (A - B)/8
7 Winning Strategies for Trading Forex by Grace Cheng
- Good bounce opportunity on 3rd or 4th point of contact for gradient of trendline less than 45 degrees with decent amount of open space between the connecting points and moving average slightly below ascending trendline.
- Open long position at 10 pips above hrly candle which closed beyond breakout level
- Place stop-buy entry 10 pips above horizontal resistance of ascending triangle.
High Probability Trading by Marcel Link
- Trade at M5 following H1 trend & stochastics
- ADX rising to 30 suggests breakout
- As volatility increases, stops have to be placed wider or they are likely to be hit
.
Thursday, 29 July 2010
Technical - Breakout
- Ignore the 1st breakout attempt
- Steep trendline is more likely followed by a breakout
- Use the end of wicks to form a secondary level below/above predominant level to determine breakout
- Confirm validity of breakout by checking with MACD & Stochastics to see if the trend is in agreement
- Double bottom/top formation, Head & shoulders (Previous trend must be in place)
- Symmetrical triangle
Conditions: 20EMA relatively flat
Entry: Break above trendline = Long, break below trendline = Short (Wicks break not considered, candle must be in correct direction at break)
Interim: Modify trendlines
Stop loss: below trend line
Exit: Pivot, fibonnaci, round numbers to 2 decimal places, add height of formation at widest to breakout point
- Fast & high amplitude price movement towards trend-line suggests that MKT sentiment is largely favoring a breakout
- Ascending/descending triangle: Diagonal support & horizontal resistance
Currency pair trending in same direction prior to formation of triangle pattern
- Pennants/flags
Conditions: Flags are usually slanted but they can be horizontal, flagpole has less candles than pennants and flags
Entry: 10% of flagpole (including wicks) to top of flagpole
Stop loss: 25% of flagpole
Exit: 100% of flagpole to top of flagpole
.
- Steep trendline is more likely followed by a breakout
- Use the end of wicks to form a secondary level below/above predominant level to determine breakout
- Confirm validity of breakout by checking with MACD & Stochastics to see if the trend is in agreement
- Double bottom/top formation, Head & shoulders (Previous trend must be in place)
- Symmetrical triangle
Conditions: 20EMA relatively flat
Entry: Break above trendline = Long, break below trendline = Short (Wicks break not considered, candle must be in correct direction at break)
Interim: Modify trendlines
Stop loss: below trend line
Exit: Pivot, fibonnaci, round numbers to 2 decimal places, add height of formation at widest to breakout point
- Fast & high amplitude price movement towards trend-line suggests that MKT sentiment is largely favoring a breakout
- Ascending/descending triangle: Diagonal support & horizontal resistance
Currency pair trending in same direction prior to formation of triangle pattern
- Pennants/flags
Conditions: Flags are usually slanted but they can be horizontal, flagpole has less candles than pennants and flags
Entry: 10% of flagpole (including wicks) to top of flagpole
Stop loss: 25% of flagpole
Exit: 100% of flagpole to top of flagpole
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Wednesday, 28 July 2010
Technical - Round Numbers
Conditions: M15 or M5 Chart, 1st bounce is best bounce, currency pair extends by at least 20 pips away from 20SMA towards round number at 1 decimal places (confirmation, optional), USD/CAD & GBP/USD more sensitive
Entry: 5 & 10 pips order from/at round number (1 decimal place for EUR/USD)
Stop loss: 20 pips
Profit Target: 5 pips
Exit: If trade not completed in 15 mins
.
Entry: 5 & 10 pips order from/at round number (1 decimal place for EUR/USD)
Stop loss: 20 pips
Profit Target: 5 pips
Exit: If trade not completed in 15 mins
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Monday, 26 July 2010
Technical - FX-Ed Uptrend Technique
1. D10EMA < D20EMA < D50EMA < D200EMA
2. D10EMA acting as resistance (candle bodies below line) on daily chart for at least 10 days
3. Entry: When candle touches D10EMA, no need to wait for candle to close
4. Stop loss: 50% of 14 period ATR (Average True Range) indicator above D10EMA
5. Modify stop loss everyday using step 4
6. Optional: Take partial profit when candle nears lower channel line of equidistant channel, or enter when candle nears upper channel line.
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2. D10EMA acting as resistance (candle bodies below line) on daily chart for at least 10 days
3. Entry: When candle touches D10EMA, no need to wait for candle to close
4. Stop loss: 50% of 14 period ATR (Average True Range) indicator above D10EMA
5. Modify stop loss everyday using step 4
6. Optional: Take partial profit when candle nears lower channel line of equidistant channel, or enter when candle nears upper channel line.
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Saturday, 24 July 2010
Techical - Candlestick Reversal
Entry: Not for range bound MKT, candle of at least 6 pips, opposes established trend of at least 30 pips
Spinning tip
Entry: confirmation candle, wicks similar in length, each wick longer than body
Evening/morning star
Entry: star candle can be any color, small or no body, confirmation candle at least half length, large wick in opposite direction
Exit: Stochastics reach 80% or 20% level
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Spinning tip
Entry: confirmation candle, wicks similar in length, each wick longer than body
Evening/morning star
Entry: star candle can be any color, small or no body, confirmation candle at least half length, large wick in opposite direction
Exit: Stochastics reach 80% or 20% level
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Wednesday, 21 July 2010
Technical - To investigate
- Always wait for retrace when you see 5 consecutive same trend candles for M5
- How to execute pending orders?
- Observations: Tendency for price to wandering at least twice at Fibo before breakout
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- How to execute pending orders?
- Observations: Tendency for price to wandering at least twice at Fibo before breakout
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