cowpip

Well, it didn't "resume" like I had hoped. The stalling at 393 had me concerned, so I moved my stop to b/e. It just took me out now (to the pip - I hate it when it does that - but I knew my stop was in a vulnerable location). It doesn't seem to have the umph to push on yet. No point in beating a dead horse. So I'm done for the day. Time for some shut-eye. Good trading, everyone! PS: Someone needs to crank up the volume on the volatility button a bit. These sub-100 daily range prints (today may be another?) are getting a bit yawny! Thanks for the cander, Texxas! It's been fun.

I decided to close my initial trade a few minutes before the UK news for +40 on the remainder. I've reinstated another long position post-UK news at 79 after seeing price resist further downside moves after the UK news release. Stop is below S1 on your chart.

Very cool, Texxas. I feel much better when we're going in the same direction. I scaled a portion out at that daily pivot zone for +50 to remove the risk on my entry. Let's see what this puppy can do.

What do you folks think of yesterdays daily cable candle print? Does it have the makings of a possible pin-bar? That's one of the concerns I currently have about trying to go long right now.

I happened to be at the screens a bit early today and couldn't resist taking a long at the daily double-fib confluence zone. I believe the reaction may have been news related (UK consumer confidence dropped) - but whatever the cause, it provided me with what I feel is a reasonable entry to ride prices higher. Yesterdays price action seemed a bit artificial or overly-muted - almost as though no one wanted to play at those levels. The daily range certainly was contracted. If price intends to push back up, this seems to me like a reasonable area to re-engage longs?

ROTFLOL! I think both you and I know just how well the Magic 8 Ball works, my friend! LOL! It works better as a pregnancy test!

Yeah, I recognized the resistance (edited: I mean, support - duh!) down near 410/20 and scaled enough out to be happy. I also reduced my stop to b/e, in case this thing doesn't have the desire to push lower. I'll let it run now and see how it looks tomorrow. Judging by current price action, I'd say it has a less than even chance of surviving. There's usually a pop during the london/NY cross that could easily take me out. No biggie if it does. I'm protected now. I wish I could stay up and nurse this - but I'm just too tired now. Good trading, everyone!

Good morning, all! I decided to take a dip on the short side at 9440, given the proximity of price to the fibs and the still dominant downtrend, as well as what appears to be some fairly stiff $ demand near this fib - which became particularly evident after the 15-minute inverted hammer that tagged the 38% fib. BTW, beautiful analysis, as always, Buk and Texxas!

Hey there Buk! Good to see you! Hope you had a great break. I too am looking forward to rolling the sleeves up. Time to dig in and help myself to some greenback. I'm hungry and need some chow!

If you can get in and out in the conditions that were present tonight, and still remain unscathed, then you are doing just fine indeed! Conditions tonight were absolutely horrible, as you can probably attest. There was no direction, and the price bars just refused to stack up nicely upon each other after the European session opened. It's nights like this that people end up losing their shirts unnecessarily. And the psychological stress of seeing trades go into and out of profit repeatedly is taxing as well. You might have just about as much luck tossing a coin in the air as playing in this mess. Even UK positive news (CBI trends) failed to kick start a rally - instead, it just whipped around like a chicken with its head cut off. There's obviously a time to trade, and a time not to trade. And tonight was definitely one of those "stay out" times. Good job for keeping your shirt on during the crappy cable action tonight!

These large swings are quite common during low-liquidity periods, and particularly on cable in December. Today you may see a large swing higher. Tomorrow, you may see prices reverse sharply lower. The moves, particularly now when volumes are low and few people are at their desks, can be quite extreme. They're lucrative, but tricky and risky to trade, and less predictable than under normal volumes. Standard patterns people watch for often break down and what would probably normally be a fairly firm support or resistance level may fall apart fairly easily under these illiquid conditions. If people trade these conditions, reduced size is probably not a bad idea.

You're doing well then, in my opinion. You can't trade completely without emotion - that's not possible no matter who you are. It's when they begin to control your decisions that you end up with problems. And since we are beings of emotion, it will always be something we need to keep in check. You sound like you've got it together, Torero! Bravo!

My big lesson is also an obvious one: Never let emotion rule. If you're wrong, accept it and move on. And never EVER give up profits on a hunch price may continue to move in your favor. The market is a ruthless beast with unstoppable momentum and without feeling for anyone. Get in it's way, and it'll chew you up so bad, your momma won't be able to ID you. These same malevolent forces can also be forces for good. Recognize price action's cues and act upon them without hesitation and you'll almost always be on the right side of the tracks.

Yes, this was awful price action on cable today. Really very rotten. But no harm done. I too saw nothing of real interest (and what I did see was severely tempered by the completely unstackable price patterns). I spent my time roaming through the crosses instead (didn't take anything there either, although some of the pairs did grab my attention for a while). Time to pack up for the weekend and try again next week after the fallout from the inflation news today. Have a great weekend everyone!

Your response is one of the clearest and most helpful I can recall! Bravo! I'm going to print that one out and refer to it regularly. Thanks so much!

I have been meaning to ask this for some time, but it just hasn't come out. For almost the entire time I have learned forex (now almost a measily 2 years), I have fixated on the major dollar currencies. I've paid a little attention to the crosses (particularly eur/gbp), but not much. I wanted to learn one currency (cable) really really well, and fixating on one was probably a good move for me when I started learning this stuff. But... I am a bit of a fraidy-cat when it comes to the crosses, because I fear that I have to learn their personalities before I can trade them. Is this true? I imagine they each have their own personalities and quirks, but do you really have to learn those personalities before you can trade them? Texxas - you mentioned in one of your recent posts (here) that the same setups and signals apply. That is encouraging. I would like to start moving out into other crosses. I've been such a cable-nut for so long, the main question I have is whether what I have learned on cable can be directly applied elsewhere. I know fibs apply everywhere, but do they apply with the same force on the crosses? I think I remember you telling us not long ago that the 35/50 S/R levels you compute were researched and applied mostly on the dollar majors, so is it safe to assume that they don't apply on the crosses as well? And I don't know very much about how the crosses respond during lower liquidity periods. I suppose it's the same deal there as it is on the majors - more spikey/noisy than when the volumes are higher. When I look at that gbp/chf chart you posted (here), I scratch my head and wonder why I insist on keeping my head buried inside a hole. I think it's time to lift my head up and look around. Thanks so much for pointing this out. If you (or others) have any important things I should keep in mind when looking at / trading the crosses, I would (as always) be in your debt.

Just a quick followup to my previous trades. Ended up closing both trades (in a "defensive stance", as Texxas so aptly put it) yesterday at 9704 after the positive cable news failed to push beyond the 9720/30 resistance level and prior to the US news retail sales which ended up being dollar positive. I expect trading conditions to become less supportive of longer swing trades (or at least, more hostile towards them), particularly after this week is up, so I'll likely just be looking for quicker all-in-all-out intraday trades through the rest of this week. Good trading, everyone!

Thanks. I will definitely keep that in mind. I imagine liquidity is already a fair bit lower than it was last month, and it will probably dry up to next-to-nothing next week as everyone heads home for the holidays. I've been on the receiving end of some of those nasty whips in the past during low liquidity periods - they can indeed be quite nasty and frustrating. But we can't predict them, nor can we prevent them. All we can do is take our best precautions to protect ourselves when they occur. It's been another very educational year for me! I look forward to the new year more than ever. Should be a blast. Thanks again for everything. I think I'll be hitting the sack now and let things run on their own until I wake. Best regards to everyone!

That is very cool! I'm falling in love with the methodology.

So this morning's pull-back to near the Asian low provided me with an entry opportunity, which I took at 9590. It was looking a bit iffy for a while, but was kicked into profit thanks to the CPI news, which hit a record high of 2.7%. I banked partial profits at +40 and moved my stop to b/e on this entry in order to protect the entry against a possible whip back later this U.S. session. No point in giving back any profits. I may also raise the stop on my first entry to the indicated level, which I think should serve as support now... still mulling that over. Maybe it's a bit premature? I'd like to see price break and stick above 9650/60 first, which it hasn't yet done. But at any rate, it's been (thus far) a reasonable add-in for me.

That was definitely the safer entry, waiting for that 2nd doji to confirm. Good point. I've decided to reduce my stop back below the S2 level for today, so that this puppy has enough room to continue swinging higher - if that's their intent. I suspect tomorrow's post-FOMC will be key to the near-term direction of cable on the longer frames, although CPI tonight should be interesting to watch as well.

This has been a fun post-NFP for me to play this time around. I took +30 from the bounce off the resistance zone that Texxas pointed out a few posts earlier (not shown below), but had taken a small loss trying to get in on this a bit prematurely. Then a few hours later, took an entry near the rising trend-line, close to the S2 level, anticipating a double-bottom. Scaled out 2/3rds of my position at 9582. By then, I had moved my stop up to 9555 to lock in profits and have left the remainder running. All in all, not a bad day. This is my first attempt at getting an image to post here. Let me know if it doesn't come through.

That is excellent money management, texxas. Without this kind of money management, accounts are surely more prone to bleed unnecessarily. Excellent post! Thanks.

Good day, Gaminig. The answer you seek will undoubtably vary from one person to the next. Many people like moving averages (20, 50, 100, 200, etc). Others like MACD. Others use these in combinations with other indicators (RSI, etc). But all of the people I know who are very successful in forex KEEP IT SIMPLE. Too many indicators and you'll likely just confuse yourself. It is interesting that most people who start out in forex use lots of indicators, or try just about every indicator they can get their hands on. Yet as they mature in trading, they drop most of them and end up watching price action patterns instead (i.e. triangles, breakouts, pull-backs, continuation formations, reversal formations, etc.). Eventually, you end up with just a few major trend lines, a few horizontal support/resistance lines (such as from major fibonacci ranges), and a whole lot of respect for simple pattern setups at those important S/R zones. Almost every swing trader I know of (with just a few exceptions) usually start out their trades as intraday trades. Once their intraday trades bust important barriers, they become swing-trades and can be managed differently than a typical intraday trade. Those who don't start out as intraday trades usually have the funds to afford much larger than normal stop-losses (> 50 to 100 pips) and can trade strictly from the larger daily time-frames. For most of us with smaller funds, this is not possible, nor perhaps wise. By far, the most important indicator I use is price action alone in combination with the dominant (most important) support and resistance zones. Keeping it simple is the most successful strategy I have found.

Not that it matters anymore, but for the record, I can vouch for Oanda. They're very good and fair, with minimal "stop-hunts," and good real-time support if you ever need it. Just watch that spread around news intervals. And don't expect any fancy graphing features with their platform (I don't use many price aids anymore anyway). Although they officially say that they don't stop hunt, the increased spread around news intervals often acts the same way. I would be happy to recommend them as a decent forex broker. I've been using them for over a year.