thalestrader

You can cut it up anyway you wish, Gabe. One of my favorite trading quotes, and I do not know from whom I heard it, is this: "You must let your winners run or they will never pay for your losers." Best Wishes, Thales

Right. And that is a very consistent result for me, no matter if I am trading futres or stocks. Many small wins, many smaller losses, and a few big runners scattered throughout. For November, for example, my stock trades were an average loss of -14.37 cents/share, with an average profit of +53.78 cents/share. But most of my trades were exited between -10 cents and +10 cents, which is fine with me. You do not know which will be the big winner and which will be the big loser and which ones will be among the small wins and smaller losses. I use a trade plan that is all in on entry with 1-3 scale out with profits. I am very aggressive in terms of not letting a 20+ tick winner turn into anything worse than a +5 to 0 trade. Someone who does an all in/all out approach would likely have a lower winning percentage than we do, but he would have an average winning trade that would be substantially larger than we get. Neither is right or wrong. Develop a plan that suits your personality. But keep in mind that while matching your personality, it must also reflect the realities of the marketplace. In other words, just because you want a 125 pip profit target on every trade. You may have the personality that would let you either get sit on your hands until your trade either filled its 125 pip profit or a a -40 pip loss. But, the market is such that you cannot expect to get many +125 tick moves in your favor. Therefore, while the plan may match your personality, it is not at all based upon your observations of how a market works. Best Wishes, Thales

Now that was funny! Thanks for the laugh, Gabe. I hope you and your family doing as well as one could pray for undert he circumstances. Best Wishes, Thales

Right you are that there is no need to knock it out of the park on each trade, and I think many folks hurt themselves by trying (or hoping) to achieve this very feat. Your post made me curious about what my daughter and I have done since Sunday in our little forex account. Since the Sydney-Tokyo open on Sunday through today, closed trades only, we have made 19 trades. Here is how they break down: 19 Trades Total: 7 Losses (includes break even trades): 7 losses for a total gross loss of -43.7 pips, or an average loss of -6.24/losing effort. Smallest loss (non-breakeven) -1.7 pips, largest loss -30.1 pips. The 30 pip loser was mine, and my daughter, who is home from school today because of the weather wanted to make sure I took credit for it. She also just reminded me that it should have been -12 (Even I can be stubborn and allow myself to think I'm right and the market is wrong from time to time). 12 Wins: 12 wins for +249.20 pips total gross profit, or an average of +20.76 pips/winning effort. Smallest profit +1 pip, largest profit +115.1 pips. Total PnL thus far = +249.20 - 43.7 = +205.50 pips. 20.76/6.24 = 3.33R based upon actual closed risk. Cut your losers, let your profits run. And do not let profits turn into losses. Keep taking your swings, and in between the singles, the strike outs, and the bases on balls, you will get the homerun. But, if you try to squeeze home run distance out of every swing, you will strike out a lot, be thrown out more often, and soon find yourself on the bench (afraid to pull the trigger/swing the bat). Best Wishes, Thales

Thank you for sharing your efforts with us. I can only show folks how I have come to apply this approach to my trading. My way will not suit everyone. Your example, daedalus, should help give folks an idea of how they may be able to appropriate a solid price action approach for themselves by using it within a framework with which they are already somewhat comfortable. Thank you for showing us how you are making this work for you. I hope that you will continue to post your charts and trades so others can learn from your example. Best Wishes, Thales

Here is the current EJ. Best Wishes, Thales

My currency trading friend sent me sent me a chart with an edited fib expansion tool to show various target levels. I liked it so much I decided to copy it and use it here for the short on the weekly GBPUSD. Again, I am a very unoriginal trader. Best Wishes, Thales

I would have gone to BE if price had printed at 128.89, which is reprsented by the dotted magenta line in the picture. However, I went to break even once price traded to a lower low after the first reaction against the trade. Best Wishes, Thales

And just like that a promising start turns into a break even effort. I know that some have not agreed with my stop management, and they feel that I too quickly move to break even. "After all," they argue, "might the EJ not just be testing the break down level? And might it not resume its decline and hit both profit targets?" Yes, of course it might. But it might also keep right on rallying and blast through any natural stop currently sitting above the market. At this point, I no longer care which it does with respect to the short trade that was just concluded. The market gives too many opportunities where my entry is triggered, and price moves smoothly in stair step fashion to my profit targets without ever threatening me with a loss for me to worry about the break even efforts that turn back in my favor. By the way, I se I typed in yesterday's date when I saved a couple of screen shots. Just note that these picturs are of 12/09/2009's price activity. Best Wishes, Thales

Hi Folks, Sorry about the late post, but the first 20-30 minutes after the open is tough time for me to do anything but scan and get orders off. The EJ short triggered, and attached is how I am looking at the trade. Best Wishes, Thales

Hi Folks, Here's a look at the current EJ. Two possible long entries, but right in the thick of potential resistance. This could also be flipped to short as well. I wanted to show how I sometimes take an early entry with a half position from within a chop zone if the swings are clear. I would not take the early entry on the short. The swing of one larger degree was up, so if I go early, it would be in the direction of that swing. Also, an early entry better move favorably immediately or I pull the rip cord and wait for the next opportunity. Best Wishes, Thales

EJ is EURJPY spot fx. There is a futures contract, but no liquidity last I looked. Best Wishes, Thales

You go look it up on Youtube. Thales

Hi Folks, Did anyone manage to get into this long EJ opportunity? I missed it. I do not know how. My daughter just came in, and she doesn't know how I missed it either. My excuse is that for the Tokyo open, I'm usually watching 6B and 6E, and I depend upon her to alert me to opportunities on the Yen pairs. And, since she was not here for the open, I blame her. Right now we'd have out stop loss at break even (a theoretical 130.10), holding for PT's at +60 and +120. Best Wishes, Thales

Need to wait and see. GBPUSD finally getting a bounce at that support level. A rally back to last weeks low before a break and hold of the 1.6200-1.6230 would be a preferred scenario. Of course, what I prefer and what I get are often two very different things. My daughter and I had a nice bear run on the GBPUSD at the tail end of September, but it fizzled and led to a retest of the post-March rally high. In the mean time, while waiting for the big campaign, just play the market from long or short as it gives and takes. Best Wishes, Thales

Current look at the weekly GBPUSD. I am looking for a sell and hold opportunity, and it may be at hand right here. Best Wishes, Thales

Good eye ... EU continued to slide lower, but maintained an ending diagonal type structure. It looks finally to have come to an end and is ready for a pause in the slide. I do not trade between NY close and Tokyo open, but this is how it looks at the moment. By "pause," I mean maybe a bounce, maybe a strong rally, or maybe just a few hours of sideways before the downside resumes. It is time to pay attention, patiently. Price will show the way soon enough. Best Wishes, Thales

Hi Folks, No time to grab a shot of a chart as I have to run, but GU looks like a long setting up here if it gets back above yesterday's LOD. Best Wishes, Thales

Get out of that 5 minute chart and spend a couple of weeks loking at a 15 minute for trades and a 240 minute for S/R. Best Wishes, Thales

Now you see it, now you don't. Best Wishes, Thales

Hi Folks, Current look at the EURUSD. Best Wishes, Thales

Post away, Jon! I have said repeatedly that this is a "Reading Charts ..." thread not a "Thales Way or the Highway" thread. There are probably folks here who can't get a handle on what I'm doing but they might see something you post and all of a sudden they'll be on their way. Best Wishes, Thales

What was the entry point and why? Is your stop loss below the low of day or somewhere else? Thus far you've not posted what is conventionally considered to be a "set-up." A "set-up" would include, at the very least, an explanation of how one is to make the decision to enter a position and the where and when of the entry, as well as establishing the initial risk of the trade. If you are here to discuss and share what you have learned, we're all ears. But telling us you are long off this here pin bar is not at all useful. Best Wishes, Thales

Thank you for the kind words. I have not disclosed anything here that hasn't been in the public domain for years, shared by those with names like Livermore, Wyckoff, Schabaker, Darvas, O'Neil, Sperandeo, and I'll even throw Joe Ross in there as well. As I have said many times, I am a remarkably unoriginal trader. For every one person who happens across this thread and tries this approach, a hundred others will pay it but slight attention and move on without ever giving us a second thought. And for every one who does become successful with it, there will be at least a handful or two who tried and gave up, moving on to the next thing. Many more will try to apply it but will try to improve it, and in the process, ruin it. As Robert Prechter once said, "most traders take a good system and destroy it by trying to make it into a perfect system.” Best Wishes, Thales

Rather than flip to short, the GU continued to rally and has now filled what would have been a reasonable PT2 at 1.6450. Best Wishes, Thales