pipMonster

We passed the local 38% fib at ~37 and the big fib at ~41 as price heads north. We still have the RN 50 and the 50% fib at ~60. Hmmm.... still determining intentions of this move. The 240-min shows a trend still heading south. Looks like a test of the big fib at 41 again. Stop clearing for those who jumped the gun long? Could also be construed as a rejection at RN 50? We'll see....

Excellent example of "Plan the trade, Trade the plan." Even for you guys with the giant accounts, things don't always work out. As soon as the position was seen as suspect, it was dumped. Next bus? There's always another value area trade coming along. May I suggest the 'Magic 8 Ball' for future reference?

Traders, give this a good read and take it to heart. Buk and Texxas know exactly what they're talking about. I know these two from a couple of other boards and through their tutelage my trading has improved greatly. What Buk says about keeping it simple using tried and true methods, though not whiz bang exciting, is the way to go. Torero, from what I've seen in his postings, uses much the same tried and true TA. Add to all of what Buk has said, a huge heap of patience to wait for setups that beg to be taken.

I came back to my trading office after the holiday and saw the same old thing. Still seems to be working. If it ain't broke...yeah? Looking forward to rolling up the sleeves, as you say.

A quick question on MT charts: Though I like them very much, the only ones I can find are either from FXDD or Strategy Builder who both offer free demos and feeds. The problem I run into is the global time setting is GMT+2 which makes a bit of a mess out of the 240-min and above charts as the candles print very differently from GMT based candles. Are your MT charts based on GMT? The charts are pretty nice don't you think?

Hey there Buk! Happy New Year to you. Fantastic commentary as usual between you and Anna-Marie. Those look like Metatrader charts you're using? Netdania has been having some trouble of late with freezes and two days of data that didn't show up at the end of the year. I'm ready to get movin' and have a great trading year. This has been a profitable week for me. It's a nice way to start off the new year. I'm relieved in a way that the $ has rallied somewhat giving a bit more breathing room for each way to-ing and fro-ing.

Ugh. I got stuck for a loss tonight on cable. Unfortunately, I didn't see it the same way as Texxas. It's upsetting, but I can't win 'em all. I learned something from this trade which is the important part.

Well the US data came and went this morning without the $ losing much ground to the other majors, cable in particular. Factory Orders were enough to offset the disappointing numbers of the ISM data and surprisingly weak UK consumer confidence data. We could see further $ gains in this thin market condition before NFP data is released into the wild on Friday. Looks to be plenty of 'clear air' below from the 240-min perspective. I wouldn't be surprised if $ bulls pulled the same trick $ bears used just before the US Thanksgiving holiday. If the $ bulls push price a bit further down and get some decent stops to trigger, there could be a nice little run down to ~9180-9200 area.

I was fortunate tonight in catching the ride down from 9495 to 9410 for +85 on 1/3 and a scale out at +20 for 2/3. I'm quite happy with this gaggle of pips tonight. I expect this week to be a bit thin still so I'm not trying to turn anything into a swing trade. Early on I thought I had missed the boat as price climbed up to 9525 from the firm rejection off 9490. It never ceases to amaze me how quickly things can change in this market. In fact, other than for purely technical reasons, I don't have any idea why price moved as far and as quickly as it did besides residual $ buying from earlier ISM data or re-weighting of portfolios. This can just as easily shoot right back up with a bit of weak data from US ISM, Factory Orders and NFP on Friday. I guess we'll wait and see.

This was indeed a news driven drop. US ISM data was posted this morning and it was $ positive for the most part. The ISM Manufacturing Index was higher than 50 which shows expansion. Construction spending was up also. Two good signs the US economy is not dead. Combine that with better than expected housing numbers at the end of last month and you have some reasons for $ strength.

So true Texxas. Cowpip and I just spent the last couple of hours nursing trades in this noise. I got in pre-London open and managed to escape with my skin. It's very noisy. These rest of this week should be quite interesting. What's your take on the possibility of the US raising rates in Q1? -Jack

Happy New Year to everyone! Torero - very nice trade. I would take a portion of your profits off at 9743 if you haven't already and trail by a swing low or two on the 60-min chart. This is a good trade, you don't want to let it off the hook at break even. Texxas, I took the night(morning?) off and just observed as I thought the thin market would lead to some unpredictable movement. This move looked pretty predictable in hindsight. I'm looking forward to a fantastic 2007. I learned an incredible amount last year from you, Buk, Bonza and Cowpip. -pipMonster

Ditto w/ Reaver. I had one problem with Oanda and it was resolved as soon as I brought it to their attention. I've wanted to leave them as I became very upset a few times with their variable spreads, but I found no other equally good broker. Sometimes it's the devil you know vs. the devil you don't.

You can start trading w/ $1000 IF you reduce your expectations to the size of your account. This means forget about leverage and get up to speed on money management and risk assessment. I would suggest an account with Oanda for the reason that they offer trades to very small size and their execution is excellent, though they do have variable spreads to watch for during 'high profile' data releases. You would want to stick to a total risk per trade of 2-3% of your account. No matter which broker you go with, you'll encounter some slippage. A few pips at the most is typical. Have you paper traded your strategy into profits and are you confident in being able to execute it without fail or question? If not, work out your strategy some more in demo land. There's no rush to get into the market. It'll be there when you're ready to trade your hard earned cash.

Torero, You make this look way too easy! Very nicely done. I've been doing fairly well recently trading the end of the Asian session and London cross. I'd like to give a shout out to Texxas and the S/R levels explained in an earlier post in Cable Musings. Thanks! Very nice tip. This past week I've removed most indicators except 60ema, 200ema and MACD on higher TF charts. I also turned off the price 'line' on Oanda charts. It seems to help me concentrate on the 'area' where price is and not so much on the price itself. It also helps with pattern recognition which includes price exhaustion for entries and exits. I'm already looking forward to next week hoping to continue swelling the account for the holiday draining at years end. -pipMonster

Consistantcy is the key which is where the mental toughness comes in. It's interesting how lots of folks, especially new traders think trading currencies is the easy way to riches. It's hard work. Everyday. I was just reading an article this past weekend about making a record with John Lennon called 'Mind Games'. The gist of what I'm trying to relate is the sound engineer thought it was going to be 'easy' work with one of the creative forces from the Beatles. Lennon will just show up with a bunch of songs ready to go. What he found out was that Lennon, and others like him, work really hard on getting a song as good as they can make it. Take after take. Trading is like that. It's hard work, but it can be very rewarding.

Hi Jay and others reading this thread, I'm not trading full time nor is it my sole source of income. What I can say from the experience of previously quitting a secure job, though one without much future, to go freelance in an entirely different field of work requires a certain mind set in addition to the support of your family/significant other. In order to trade for a living you need to be very comfortable in risking your neck to achieve your dream. I did this ten years ago when switching careers of my own choice. I was not forced out in any way. A trader would need the confidence to 'walk the walk'. By this I mean the belief they can generate the needed income from trading to not touch the 'back up living expenses'. This means total confidence in your strategy of trading that it will, if applied correctly and consistantly, generate the needed income. I would say a trader needs 6-9 months of expenses in the bank as back up. This trader would need to cut existing expenses to the bare minimum and then add 'goodies' to your lifestyle as rewards for good trading. The trader would 'do' not 'try'. This is a business. You need a passion for it, but also a detachment to look at your trading scenario and ask "What would I recommend another trader to do in this situation? Enter, exit, stay flat, pare down, add in, etc.,? Can you see yourself paying for your child(ren)'s university costs by trading? How about your mortgage? How about your food? Health insurance? If you have the confidence, I mean realistic confidence not the "I'm sure taking a big chance here I hope I can do this" kind of false confidence, then you may very well be able to trade for a living.

Hi Torero, I've been trading forex for a few years now and haven't seen a gap like this. Smaller gaps sure. This is quite unusual. Right now, I'm out and flat, watching the market. I most likely won't be engaging until near the end of the Asian session. I find this price action incredibly interesting.