thalestrader

I see that I deleted the 155.15 line when I was deleting some of the text from last week. I put it back on, and you can see that price came down right to that level and is finding a bit of support. I doubt that it is very strong support there, and I'm fairly confident, though nothing is certain, that should price break below that 155.15 will take the GBPJPY quickly down to 154.95. Again, if you are playing along at home you may beed to adjust the precise levels discussed here to your own broker's price feed. Best Wishes, Thales

Hi Folks, Continuing our Support/Resistance study of the "PoundYen". GBPJPY broke support at 155.35 area and should drop it to at least 155.15(20 ticks). A break there takes it to 154.95 area (40 ticks), and a break there leads possibly to a drop to 154.60 area (70 ticks). Best Wishes, Thales

Hi Hal, You said that: I agree. I do not think I implied that it couldn't, and if I anywhere did so imply, I was wrong to do so. No, but do they not come dangerously close to making just such a claim: Now, I don't know about you Hal, but here is how I think of the issue at hand: I know that I can trade profitably any market, anywhere in the world that is traded freely and with enough liquidity to let me in and out at will, and all I need to do so is a running record of price. I do not even need a chart. I just need a record of prices. I prefer to use a chart. I find it easier than, say, trading using an excel spread sheet. But all I need is price. Now, could I or anyone else truly say the same thing about volume? If I provided you with nothing but a streaming volume histogram, could you trade successfully without knowing where price is and where price has been? I beleive that no one, even those who claim they could "almost" do so, could really do so. So, which leads which? Which is the primary indicator? The answer is clear: The primary indicator is the very one that provides enough information about the market for one to trade that market without any additional information. That indicator, Hal, is price, not volume. I am not saying that volume cannot provide the astute observer with important information. I am saying that that information will simply confirm what is already observable from price itself. For that reason, I will continue to persist in my "very bad habit" of watching the price pane of my chart, which, by the way, is the only pane I care to keep on my chart. Best Wishes, Thales

Senior members (read been around the block enough times to know) are well aware of your intentions.

My daughter uses FXCM, and they had a strange price spike on the GBPUSD the other day that disappeared later. She wasn't in a trade at the time, so it did not affect her at all. I do not know if FXCM varies the spread at news times as I haven't paid that much attention. Best Wishes, Thales

I will try to post some of her trades to the real time thread in coming days.

It is quite obvious that the nest has been disturbed, and James will need soon to decide if he will make the necessary changes now, or if he will allow his good forum to degenerate into an ET like community.

I consider myself to be someone whose trading decisions are based primarily upon price action. The majority of my trading is composed of day trading individual stock issues. Most of my trades are based on simple support and resistance breaks. As such, it is undeniable that I trade price action. However, when I day trade stocks, I use a 5 minute chart, and I do keep a 20ema on that chart. Whether I like it or not, it is an undeniable fact, and one that I can prove empirically each and every day, that when a stock is trending strongly from the open on a 5 minute chart, price tends to find buyers in an uptrend and sellers in a downtrend when price pulls back to that 20 ema. Is that the same as "trading price action?" If it is to be considered trading price action, then it is so only derivitively. Does that mean that someone who uses such an indicator is not a price action trader? It means nothing of the sort. After all, if the majority of his or her trading decisions are based primarily on support and resistance, what else would that trader be? You mentioned pivots (and I assume you mean floor trader pivots and not pivots in, say, the Livergood sense). I have a good friend who trades foreign exchange exclusively. No stocks, no options, no e-minis, no bonds - just spot currencies and currency futures (he may use options on currency futures, come to think of it,but not as a primary trading vehicle). He trades one basic price action "set-up." I consider him to be a consummate price action trader. But you should see his chart! He has ema's, fibonacci's, pivots, mid-pivots, trend channels, cci, volume, some other thing I do not even know what it is. But, he trades one "set up" only, and it is entirely a price action, support and resistance based set-up. Now, does the fact that he also uses 27 or so of his favorite indicators disqualify him as price action trader? I would say no. I think he is absolutley a price action trader (I also happen to think he could do away with every last one of his indicators and still trade his set up well, but who am I to argue with a guy whom I know to pull in five figures from his trading per week, week after week from the comfort of his sofa). I think one can distinguish between someone who uses indicators to help support a price action based trading approach, and one who uses indicators as a trading approach. In other words, using indicators is not itself an indicator of whether or not someone is trading price action. What makes the difference is whether someone is using the indicators to support his or her reading of price action, or is the trader using the indicators to make trading decisions independently from any attempt to determine the immediate trend from price action itself. Best Wishes, Thales

The problem, ehorn, is that no one who claims to have found success with your Jack Hershey Method has ever demonstrated to anyone anywhere in real time that such success is indeed enjoyed. I have asked for just such a demonstration. But nothing of the sort ever came from you or your fellow method members. Likewise, Db has more than implied above that you or Spydertrader or Jack Hershey himself would be more than welcome to make an appearance in the TL chat room and provide a real time demonstration of your method. But I doubt you any other member of your gang will prove himself willing to provide that demonstration. Isn't it enough for you just to continue to post your charts in your own thread each day at 4:15 EDT telling your followers how well you did that day? Must you now troll all over TL for fresh victims? I say victims, because until your method is demonstrated at the proverbial hard right edge of the chart, you are indeed victimizing those whom you induce to commit their time and capital to learning this method. And you do induce them. You do so by asserting that your method allows for the absolute predictability as to where price is going to be and, if I'm not mistaken, when it is going to get there. You mock those who acknowledge trading as a game of probabilities. You promise your students certainty. If your method really allowed one to predict price, as you claim, rather than merely anticipate price, then you should have no fear of your ability to put on quite an impressive show. Believe me, if you or one of your followers would actually demonstrate your method in such a way as to validate the claims made on its behalf, I would readily be willing to change my opinion concerning your method, and to do so publically. -Thales

I agree, Db. And there is now tolerated an entire thread here at TL that serves no other purpose than to so detour the novice down such a detrimental path. I've been down a few such paths myself and wasted more money and more years than ever should have been allowed, both by myself and my "guru-mentors." My advice to the original poster is this: Dedicate yourself to removing all indicators from you chart and spend two and half months really focusing on learning to read price action. If, after two and half months of studying price you are still unable to trade profitably, then you either do not have the ability to read price (which is doubtful, even a child can tell up from down from sideways), or (and this is more likely) you are psychologically unfit for trading, and you must seek to understand how your fear is controlling your trading rather than your knowledge of price action, and learn then to control your fear. Or, you can continue with your clutter of indicators, and perhaps be pulled into one Guru's Den or another's, and two and half years from now you will still bemoan the fact that after two and a half years you still do not have the right indicator or that you still do not understand your Guru's "wisdom." The credible in the trading world offer you freedom, by demonstrating a self-sufficient approach to profiting from anticipated price moves. Learn to read price action, and you will not need to follow a Guru from internet forum to internet forum. You will be free, and you will need only a sufficient capital deposited into a trading account, a computer with an internet connection, and a chart. It is up to each one individually. You will have to determine for yourself the credible from the incredible. Best Wishes, Thales

The only indicator that will tell you what you wish to know is already on your chart, but you have so many useless indicators sharing space with it that you have distorted it nearly beyond recognition, and certainly beyond usefulness. If I were you, I'd follow Db's link and forget anything anyone else, including myself, might post. I would stop searching for a magic indicator, and for the next several weeks or months, devote myself to studying the material to which DB is directing you. But that is me. And I already know how to use the indicator that you wish to be able to read. Here is your chance to learn to use it as well. And do take Db's advice, clean up your chart. You have so many indicators that you distort the only indicator that matters - Price! Yes, price is the only indicator that leads itself. Always. And without exception. Best Wishes, Thales

Hi Folks, Still on a little vacation. My daughter traded and did well, but I am not sure what her trade(s) was/were as I was too busy posting and yakking with folks and didn't pay as much attention to her trades as I would usually do. Best Wishes, Thales

So sell at A, take profit at C, especially as this would have been an overnight trade. If this had been, for example, the 6B, and I was entering an order at night, I would have 1 entry at A, a stop loss above the upper red lines, and one profit target. If it were during the day, Iand I was able to stay on top of the trade, I would have taken half profits at c, and either let the second half ride with a breakeven stop or I would have had a profit target below at the next support. I see that this particular pair has a 4 tick spread at FXCM micro, which means it is probably 5-6 ticks elsewhere, so that 50 tick profit I spoke of may be more like a 40-45 tick profit. As far as entries go, I have always been one to enter on a 1 tick buy/sell stop. Of course, trading at a bucket shop where there is a marked up spread like this pair has, maybe, maybe I'd add a pip or two, so that I wouldn't get filled at a price where price never really traded. That is the one problem with trading at a bucket shop that I do not have to contend with trading currency futures. If have a sell stop on the EURUSD at 1.4100, I may get filled there, even though price never traded there anywhere by at my broker and in my account. Whereas if I have a sell stop on the 6E, and I get filled, I know that price really did trade there, even if I were the lone piker who sold the low tick, it was a real trade. All this is really to say that if you are a forex trader trading with a bucket shop, then you need to get a feel for the manner in which your broker deals the spread. I have my daughter trade primarily the EURUSD, GBPUSD, and the EURJPY. The spread on the EUR rates at FXCM micro are typically 1.2 ticks or less, and the spread on the GBP is typically 1.8 ticks or less (a far cry from the olf Refco days of fixed 3 tick spread on the EURUSD and 5 ticks on the GBPUSD). The good news is this: If you trade S/R, the bucket shops can be beat. But you do have to learn to accomodate the spread in your trading. Best Wishes, Thales

Hi Forrst, I'd never want to ignore a friend. The first chart just shows price. The subsequent charts show various S/R levels marked by horizontal trend lines. The point I was trying to make is that once you identify S/R levels, it makes it much easier to see "where" price is in relation to where it is likely going. It might be easier if you put that post together with the posts from last night that I made using the GBPJPY. Start with last night's posts, and then lok at thse charts. Best Wishes, Thales

Here is an interesting study of Support and Resistance in Action Best Wishes, Thales

Hi imorgan, I placed some notes on the chart: Once price breaks below that blue trendline, it should not return above the double red lines before it first reaches the lower red line. So a sell stop at 1.5594, with a stop loss at 1.5634, and a profit limit of 1.5544 (as price feeds vary not only between different brokers but also betwen different customers of the same broker, anyone looking at these figures would have to adjust to his or her broker's price feed). As you can see, price did rally briefly and choppily above the double red lines prior to breaking below the blue trendline. It did this after I had finished watcing and gone to bed. If I were trading these markets myself, I would have set my orders exactly as I outlined above - if price dropped to 1.5594, I would want to be short, and if ater getting short, price rallied above 1.5634, I'd want no longer to be short. As I said last night, a drop below that blue line would be a high probability 50 tick profit in the bank. Makes me wish I had my own forex account to trade. Again, as I mentioned last night, I know traders, in fact, I see traders posting right here at TL who place 4-6-8 or more trades each day and at the end of the week haven't made 50 ticks net profit. I'm not saying that there are not successful scalpers out there (and I am aware that neither what they do nor what I describe here is "scalping" in the sense of buying and selling inside the spread), but it does seem to me an awful difficult and stressful way to earn a living. But to each their own. Trading S/R: 1) Allows you to plan your trades in advance, 2) Allows you to scalp for 30-50-100+ ticks per trade rather than 2-5-10 ticks per trade, 3) is so easy to learn even a child can do it. That third characteristic is what makes trading S/R so difficult, as human emotion balks at the thought that something where 95% of the participants are unsuccessful should have so simple a solution. Of course, leaning S/R is made somewhat difficult by misinformation about what it is. For example, in a recent issue of TASC, an article about S/R contained at least one glaring mistake where a test of support is characterized as a false breakout because the author identified a price level as support before that level could legitimately have earned the honor of being so named. I am sure most folks reading that article would have agreed with the author that a "false break" had occurred. The good news is that you do not need to spend thousands of dollars on a trading course, special software, or a paid mentor. A few inexpensive books, a demo account, and lots of hands-n, eyeballs-on practice and screen time and within a few months, you should be well on your way to freedom. Of course, learning to trade S/R is truly the easy part. The hard part is controlling your emotions, your fear and hope and greed, but mostly your fear of loss. If you can control that, and learn S/R, then you will have acquired something truly liberating. Best Wishes, Thales

One last chart for the night, this is the 15 minute GBPJPY. Never traded it myself. I do not think my daughter has, though she may have once or twice for all I know. But whether its PoundYen or Potatoes (anyone here been trading since before Potatoes went off the boards for good?) S/R is all the same. I imagine that if price were to drop below the small blue trendline at 155.94, that might be good for a 50 tick +/- drop. I know folks who scalp all week long and don't manage to come close to putting 50 ticks in their account, let alone their pockets. Of course, it may not drop that far. It may drop further. It may not drop at all. But, if I were a betting man ... Best Wishes, Thales

Here is the one hour EURJPY as of 10 PM EDT. It will be interesting to se what it looks like come morning. Best Wishes, Thales

Hi Gabe, Good call on the short. My daghter and I were watching the EURJPY on the 1 minute chart (We're a couple of chart geeks - everyone else is downstairs watching a movie and we were watching a one minute currency chart - we even had a bowl of popcorn!) The thick red horizontal trend line is one of her resistance points that she had drawn on her four hour chart. After price rallied through it last night (or this morning, I wasn't watching) one would have expected that it would have held as support on a pullback. Instead, price sliced right through it, chopped back up to, and you can see how that resistance reasserted itself as such. She didn't trade it, but she was tempted. Your higher buy point would have been a break above that red resistance level. A recovery above there would likely have resulted in a retest of today's high. As it is, the EURJPY looks like it may be heading back to 133.37-133.50 before the weekend comes. Thanks for sharing with us Gabe - please keep it up! Best Wishes, Thales

I think breaks of prior day highs/lows are especially hig probability trades in certain markets were the pit still has a lot of influence, e.g. bonds, notes, eurodollars, perhaps the softs and grains. My experience has been that the S&P's prior highs and lows are often tested by a probing back and forth, and therefore, it is often better to wait for a break and hold. I may be wrong, but that is how it seems to me. Good observation on the bonds, imorgan. Best Wishes, Thales

Hi folks, I've been busy having fun with family and friends this week. My daughter traded yesterday and did well. She had no trades today as we do have visitors. I felt terrible, but I had literally to forbid her from the comuter today. She ended up having a fun day, so I think she'll forgive me for it. I have attached yesterday's equity run as well as today's, just so no one thinks I was trying to hide a losing day from you folks. I have to admit, I'm right here watching her with my own eyes, trading right next to me, and I hardly beleive her success myself. Best Wishes, Thales

Hi Hal, It makes me very happy to hear that I may have said something in my ramblings that you have found useful, especially if it really makes a positive difference in your trading. I don't mean to speak for him, but I'm sure Brownie feels the same way. I was fortunate to have found a few folks who helped me get my head on right and turn my trading in a positive direction. My hope has been that I'd have the opportunity to "pay it forward," as I believe the saying goes, by helping others as others have helped me. I wish you and yours all the best that life and this business have to offer. Best Wishes, Thales

Try clicking on "file," then "new," then "chart." Unfortunately, learning new things, such as how to use a new tool, requires time. No one can learn it for you if it is to have any value to yourself. When you go to online support, look up "data connection" and "chart template." That should get you started. May I suggest that before you try to go live with ninja using tradestation that you sign up for the free zen-fire demo and learn t use ninja itself first as a simple stand alone charting program. After you are comfortable with Ninja's workspaces and charting functions, then move forward with going live. Best Wishes, Thales

Indeed, Brownie. Another sure sign of the would-be Guru is that when someone asks said guru a question about his analysis or method or what have you and, the guru answers your question not with an explanation, but with a question to you, or else, he just gets defensive. Best Wishes, Thales

I have been very pleased with Ninjatrader. My opinion of Ninjatrader, in fact, is the complete opposite of yours. Here is a link to a support page: Online Trading. NINJATRADER Support Center. Best Wishes, Thales