USD/CHF Trade Idea > Long at Demand Zone

Based on the last significant Demand Zone, I am entering an Automated Trade order based on this chart:

Based on the last significant buying area (demand zone), when it was a good idea to go long on this pair, I have entered an automated order to purchase 3 mini-lots or a $30,000 contract to purchase this pair long at 0.9433 if it dips with the intention of the pair bouncing up to a supply zone of 0.9560ish. Risk -ve 23 pips vs. Reward +ve 129pips. I may remove the automated order and do this one manually or adjust the entry point based on the activity in the next hour or two. Swing low to swing high.

Review and Strategy Going forward into Autum 2012

After what I would consider a slow start to the year, with only a couple of trades (literally only one in February), and then a meager spring (only a few), my summer took off and never looked back. I have managed to reach the point where my trading activities are netting almost the equivalent to my day job salary. I work almost 50 hours a week, by the way. I'm not bragging, well, I have put in nearly 5000 hours into this over the last few years, and, it seems, while I was not a slow learner, I was slow to control myself.

This morning, I took my monthly statement from my broker, along with a notebook and sat down in a coffee shop and wrote a bit. My August was decent to say the least, $1670 in profit from a less than $5,000 trading account. 5k was a bit of a barrier for me as I had been there before and crashed afterwards. Now, I'm sitting nicely at $5,800 and looking to $10,000 in the coming months. So far, September has been decent to me with $670 earned this week. I have no illusions about not needing a day job at the moment, but I think the next book I purchase will be the The 4-Hour Work Week.

In the last couple of weeks, something interesting happened, I learned to pace myself, I learned to not sit at my desk all the time and stare at the charts for trades that I had under way. I learned to trust myself, step away and allow my trades to work out. I have in fact spent less time trading and my profits have improved.

Aside from everything else I am doing this weekend, I am going to put some time into studying chart patterns, and planning a couple of automated trades for the next week. I have only limited experience with this, so I will only be using light orders for this while I get my feet wet. In theory, a few minutes of analysis a day could earn profit without me having to manage the trades while they are in process. Now, time to study a bit.

AUD bad data (Trade Balance) but a muted negative response

The trade balance released by the Australian Bureau of Statistics is the difference in the value of its imports and exports of Australian goods. Export data can give an important reflection of Australian growth, while imports provide an indication of domestic demand. Trade Balance gives an early indication of the net export performance. If a steady demand in exchange for Australian exports is seen, that would turn into a positive growth in the trade balance, and that should be positive for the AUD.

-556M Actual > -300M Consensus > 9M Previous

This is where I get a bit scared, so trade balance is down, down by more than anticipated, and the result is that the AUD/USD and AUD/JPY both dipped but are now showing stability. When this happens, I start to think either technical analysis is winning over fundamental analysis or that something is rotten in Denmark. Mind you, I'm hoping both pairs go up but I can't figure out why.

AUD/JPY Bullish for now...

It is a bit late to share this idea, because the time to buy would have been 100-140 pips ago, when I did, but here it is. Good data out of Australia last yesterday and good ADP data, and good ISM data = AUD/JPY up.

In theory, based on ADP data earlier today, the NFP should be okay, and it could go higher. I have a target of 82 to 83, but who knows. Of course the trade balance data out in 20 minutes is pointing south so I may just collect my 100+ pips and call it a week on this pair.

EUR/JPY into Demand Zone in Theory

Supply and Demand, EUR/JPY is now into the session's Demand Zone shown by my trend-lines. Took a $40K contract long with the idea that it may go higher today.

As usual, the future cannot be predicted with 100% accuracy, but we can make plays based on patterns and indicators.

AUD/USD Update

Interesting to see a partial confirmation of my earlier Analysis. Hopefully going much much higher in the next day or so.

Immediate target of 1.0450ish area, and if this resistance zone is broken with sufficient strength, I'm confirmed for a move to at least the 1.0520 highs of last week, and depending, a break higher on that range to 1.06 / 1.07 area.

EURJPY Looking a bit Tempting

Looking at this 5-Minute Chart, the possibilities are very tempting. Could it break new highs or retreat lower.

I'm not sure, so I'm not taking a position, simply watching in case I do get a confirmation either way.

AUD/USD, 240 Min Chart, Yet Another Perspective

Continuing from my last few posts on this trade, this new snapshot from my charts should speak for itself. This is why everyone should look at multiple time-frames for any trade they are about to take or any trade they are into.

It looks as though price is on the way from swing low to swing high. The next few hours/days will confirm or deny. Yet another perspective, the 5-minute chart drills down to the essence of the action in the Asia session:

It also shows some short term resistance levels against price moving higher.

In Trading, Psychology is Key

About to go out and have a bit of fun, my week has been great and bad, but I continue to exist, and I move forward. I am about to share time with friends and have a bit of fun, but I did want to share a gem of a webinar that I found on fxstreet.com on trading psychology, which is in my opinion, how the mind works, the most important factor in trading and in life.

The Trading Mindset

AUD/USD Update Downtrend Appears Confirmed but...

The Downtrend seems quite evident now on this pair, but it appears as though the low of the trend is in place for the time being. The long position may still have some validity, based on a possible upward move in the channel drawn on an hourly chart here:

A more conservative target of 1.0480 to 1.0490 might be possible, but it probably will not happen during this trading week. I would keep a stop below 1.0380 for the day and possibly even lower for the weekend if I were in a long position. While this might be a mistake, and it does violate a trading rule held by many traders, conditions are dynamic and can often change at a moment's notice. I am of the opinion that adjusting stops can be done within reason if conditions keep your goal within reach and the additional loss is not beyond your tolerance. There is no reward without risk.

AUD/USD Rectangle on the 60 Minute Chart

Although I have read a few reports and seen that the AUD/USD could be forming a new downtrend, it has yet to be confirmed from my perspective.

Looking at this 60-minute chart, it could make sense to buy in the demand area of 1.0420 - 1.0450 on the possibility that the AUD/USD will return to 1.05/1.06 in the next week. Either of these are good targets, depending on which way the market and sentiment moves.

On this 240-minute chart, there may also be support found in the 1.0350, the 0.250 Fibonacci from the June 1st Lows (0.9580) up to the August 9th highs (1.0613), and a 200 hour SMA found at 1.0380. Depending on what happens, this could even be a sell signal from present price of 1.440 down to this area.

Then again, it is Friday, and who knows what will happen on the weekend, so I may just close what I have in the next few hours and call it a week.

First $1000 Week In a Long Time

This week is a bit of a milestone, but I have been here before. This time, I will do what I did not do the last time I reached this goal: I will stop to smell the roses, as they say. When I started trading, I came up with a series of goals, one that stands out in my mind from several years ago, aside from the Aston Martin I wanted, was to build a $500 trading account into a $5000 trading account, in a period of 6 months through successful trades. I was doing this full time, living in my father's basement, and unemployed so I had not much else to do at the time. I dived into the markets, I researched, I lived, breathed and slept trading; yes I even had dreams where I was trading.

The end result was that I did reach that goal in approximately six months, but the problem was that I broke a few rules to get there and I did not know how to behave once I reached that mountain top. Well, I kept going, and I kept taking risks without proper analysis and I got into a series of trades that broke my account pretty much right back down to 500 or 600 dollars but I would need to check my monthly statements to confirm the exact amount. I climbed up to the top of the mountain and ran right over the peak and went down to were I started.

Several years later, while working a full time job that has been stressful to put it mildly, I have once again reached that goal I set for myself, and in one week, a series of trades put my account back up to $5000 with this week's gains going slightly over $1000. This time, I am taking some time to reflect on what I have achieved, on what I have sacrificed, but more importantly what I have learned and what my future goals are from where I am now. Where ever I want to go, whatever I want to do, it is just a matter of time, patience, and discipline.

EUR/USD Report August 16, 2012

I have been trading mostly with the YEN crosses in the last month and a half, through which I have had my best month ever. I wanted to take a breather from the volatility and decided to play a bit with the EUR/USD and also with the GBP/USD. I have found a possible bullish signal for EUR/USD, provided any bad news is limited in the next day or so. Looking at the 240 minute chart, there is a trend-line beginning in July:

If the July trend-line (starting July 24 lows) holds @ 1.2250/60, then there may be a bounce targeting 1.2400/50 depending, but if that line breaks, 1.2150 (Aug 8, 2012 lows) would be the first target of a move down. There are no guarantees either way, so be careful with your account and take responsibility for your own actions.

Mentoring a New Trader

For those who can impart the basics of trading and the psychology of market behaviour, helping someone learn how to trade can be as rewarding personally as it is for the student. For the student, a careful and disciplined application of their new skill set can change their life. For the teacher, the rewards are many. First, there is a reinforcement of the skill they have already honed in the market. Next, the teacher's own trading rules and respect for the market will be relearned and reinforced. Finally, there is a satisfaction to improving someone else's life.

Direct trading advice (as I have learned from my own mentors), should be avoided; a consistently successful and established trader should be able to spot their own opportunities for the duration of their trading careers. In addition, direct trade advice will carry with it, the possibility that the trade will go badly, and potentially sour an otherwise good relationship. Part of learning how to trade is learning to take both responsibility for ones losses and personal satisfaction for one's success. Trade ideas on the other hand can be given freely but with the disclaimer that results are not guaranteed. Often, the best way to teach someone about operating in the market is to show examples of market behavior, and extrapolate possible outcomes.

Much can be learned about trading by direct observation and the very action of taking a continuing series of trades; there is no substitute for direct experience. Researching from a variety of resources including books, forums, and encyclopedias can help tremendously, however, often the most interesting lessons can be learned directly with consistently successful and established traders. While this last source of knowledge might seem out of reach for those students who do not know anyone personally or cannot afford a trading coach, the knowledge is obtainable with some effort. Many recorded webinars and videos can provide a trader with a non-interactive source for this information. Topics include everything from technical analysis to market psychology to building trading strategies and everything in between. Furthermore, many brokers and several websites provide access to live and interactive webinars hosted by traders, analysts, and other experts for a whole host of topics relating to the market.


Finally, a newly minted trader, with a fresh perspective, can show their teacher new information and ideas obtained through their own research and experiences. As with other skills in life, you never stop learning.

An additional note of caution, be careful about choosing who you share knowledge with, trading is a full contact sport and carries with it risks both financial and psychological...

Trading Again after a Break

Some things change, some things stay the same. Since last updating my blog, I have been through quite a few changes in my life. A new job, two moves, and a serious reduction in my trading activities for a spell; this did not and could not last and I find myself trading around my career, working towards the time when I can trade full time. This blog has also been neglected for about two years because I have had nothing to add. I will be making the odd post here, when I have time, but it is not a priority. I would rather be trading, than writing about it. This morning I found myself with a bit of time, a very good run on my positions and I had something to say.