thalestrader

Oanda has a lot of otherwise smart folks fooled into thinking they are a "better bucket shop." Let me ask you this ... would you trade the ES at a broker who set a 1093 bid - 1094.25 offer? Why trade with a bucket shop that does exactly that to you on currency crosses? Best Wishes, Thales

And another look at the EURJPY ... clearly, as you can see, it is clear that EURJPY ... Best Wishes, Thales

Hi Gabe, 1.2 at FXCM Micro. Oanda's is probably 10-15 right now though. Best Wishes, Thales

Just running some laps, doing some stretches ... Best Wishes, Thales Getting Warmed UP.wav

Believe it or not, except for US NFP, I really do not pay much (if any) attention to pending news. And even for NFP, if an opportunity presents itself with news pending, and the entry is triggered, then I will be in. Best Wishes, Thales

We usually don''t put any trades on until Tokyo opens unless there is unusual volatility early on. But it is always nice to try to sync up a bit (sort of like doing warm-up laps). And here is another look as it may go the other (either) way. Best Wishes, Thales

Starting to look a bit like a chop zone ... Best Wishes, Thales

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

I wish I had been able to experience the same when I was starting out. A chart would be nice, Dinero, share and share alike. Why not show us how you decided to exit the trade, and then take another shot showing how you would have used the BB's to remain in the trade? Perhaps this should make you feel fortunate rather than stupid. You are free to do what you want, use what you want, and experiment with what you want. The question is will you ever develop the eye for following price as effectively as you wish if you are splitting your attention between price and an indicator(s). I feel that my development was delayed by an undue reliance upon indicators as I searched for the Holy Grail. I think daedalus's post #1169 of this thread may be offer some things for you to consider before deciding whether or not you will sit down to feast at the indicator smorgasbord: Best Wishes, Thales

Yes, I have known many who have tried to make it in this game. Those who have found some degree of success almost invariably have spent 10's of thousands of dollars over the years on "chart ornaments," only to find that the succes that eluded them finally came once they learned to trade with nothing other than price bars. Also shocking is how easy it is for someone who does come close to what you have called "the truth of the markets," to revert back to hanging chart ornaments on their screens. Best Wishes, Thales

I have said that I have purchased more than my share of indicators, systems, softwares, books, dvd's, trading courses, ect and so on over the years. One of those systems was MTPredictor software. Of all the ones I had purchased, this was the one that was worth having owned. First, the trading course that comes with the software, though not the most polished, was very good and useful. Also, the software and the course really drove home the importance of risk analysis, position sizing, and R/R considerations. Here is a Nat Gas trade form nearly three years ago, and that was and still is my single best day trade ever on an all in/all out trade. In this particular case, MTPredictor gave a buy signal as price was bouncing along support in an area that allowed for an extremely tight stop loss. An R unit for me at the time was $600/trade. That day, a $600 bet paid $24,234 over the course of about 6 1/2 hours. At the time, I still was second guessing my self, and often I would skip signals, only to watch the market move in a way that would have allowed for a decent profit. Invariably I would then take a string of trades that would lose. Then, having been demoralized by the losses, I would skip the very next trade, and, you guessed, that was the trade that would have made me whole on my recent losses and profitable for the day or the week. I wrote those notes on the chart to myself. I printed this chart out and kept it by my workstation for at least a year. It cured me of "thinking" and helped me put me firmly on the road to trading what I see. I'd have been sick if I had skipped this trade. By the way, I am still waiting for that next all in/all out 40R day trade. As you can see, even after I had turned the corner and was primarily trading S/R, I was not always trading without water wings. Best Wishes, Thales

Hi Folks, I was going through some old trade files tonight. Here are some miny Nat Gas trades from 2 1/2 years ago. As you can see, while I was basically trading the same then as I am now (I used 1-2-3 and A-B-C interchangeably to annotate the price action that identified the trade opportunity), back then there was a CCI on my chart, and I used CCI trendline breaks to "confirm" my trades. I trying to find exactly when I shed indicators completely. As of 2.5 years ago, I was still clinging to the CCI. Best Wishes, Thales

Additionally, I wanted to restore your original post by quoting it here. If you object to it, let me know, and I'll ask James to delete it. I think it a good post and I would hope you allow me to let it stand. Best Wishes, Thales

Kiwi, Really, there is nothing about which you need to apologize. I am not one to censor things (though the Brooks post above threw me for a bit of a loop as it seems ill-conceived and old out of place, if not a bit suspicious). I find your participation here valuable (and I'm sure others have as well), and I would not want to to start "filtering" your posts. Just to show you how open minded I am willing to be, I have attached a current chart of the EURJPY, In your honor, I have added an 89 ema. I have colored it white, but its there for you, nonetheless. Enjoy the weekend! Best Wishes, Thales

Unless, of course, you are a failed "too big to fail" financial institution. Best Wishes, Thales

What happened? Best Wishes, Thales

Great story ... "losers average losers." Thanks for sharing. Best Wishes, Thales

Excellent contribution to the spirit of this thread. Thank you. Best Wishes, Thales

Kiwi, You will never convince me to add anything of the sort to my charts. I would also bet that my best short trades have initiated when price was above your MA's and my best long trades have initiated when price was below your MA's. You and I have discussed a certain trading system in private, a system that is laden with indicators. My currency trading friend basically trades that system. For years I showed him exactly what I do, how I do it, told him to look for S/R, highs and lows. But he kept playing with this indicator and that indicator. Then he happened upon that particular system, and for some reason everything clicked for him. He has been pulling down four and five figure profits weekly since adopting that system to his trading. It is not my place to brow beat him into abandoning his water wings as he swims in the deep end of the pool. In fact, I am very, very happy for him and the success that he is now enjoying. Now, if you ask me, the difference between what I do and what he does is that he adds 27 of his favorite indicators to do what I do without any. I assume that his indicators would sometimes keep him from entering what might otherwise have been losing efforts, but, in my opinion, they more often had him miss the most favorable entry for winning efforts. For example, he uses a band of ema's, and in accordance with his system, he would only take a long entry if price were above the upper band, and vice versa for shorts. Over the last few months of him reading this thread, I finally have him looking to take entries based upon what price is doing in relation to S/R only, rather than what it is doing in relation to moving averages. I even have him almost weened from his precious CCI (though he sometimes slips and sends me a chart showing the full complement of his systems's indicators, including the CCI). If he ever were to start to slump, I'd be the first to tell him to put his water wings back on. Now, with you as with him (and anyone, for that matter), if these indicators help you, or if you at least believe that they help you, then by all means keep them. I am not opposed to anyone using indicators here in this thread so long as an explanation is made as to how he or she uses that indicator to make trading decisions. For example, I really appreciated daedalus's posts this week where he shared the indicator he uses and how he uses it to make trading decisions. I am likewise not opposed to anyone posting trades based upon some approach different from what I am doing, so long as a chart is posted along with an explanation as to how the trader came by his or her decisions. After all, when I started the thread, I named it "Reading Charts in Real Time," and not "The Thales Chart Method Thread." For example, I really appreciated when ehorn shared his an example of his approach using the daily chart of SKF. I would welcome him back here anytime he wished to share and update an ongoing trade using his method, so long as he explained his trading decisions as he did on his SKF example. All this to say that while I have an open mind, using MA's is not something that I would wish to add to my own decison making process. Best Wishes, Thales

I was hesitant to post the EW stuff because 1) I do believe it is dangerous, as many foks will be seduced by what its purported ability to predict where price will go and when it will get there. I do not use it to predict. I simply acknowledge that EW theory does accurately describe certain repeating structures exhibited by price as it moves through the middle of nowhere on its way to support and resistance levels. I also hesitated becasue 2) EW, because of the "predictive" claims made by proponents. is controversial. I decided to go ahead and post it because I do find those aspects that I find accurate and descripitive of actual phenomena useful. No one is going to make you read it, Gabe, much less use it. If you read my post carefully, you will see that I cautioned against granting the theory the forecasting and predictive powers that those peddlers of price precognition impute to it. However, I will not reject out of hand that which I found to be useful simply because others have sought to distort and misrepresent its value for personal gain. I have found certain aspects of EW useful, specifically EW describes a few common, repeating structures of price action that are easily recognizable that help me identify potential opportunities. If you find it useful great. If not, that's great too. I am a big advocate of human freedom. Yes, the "Three little indians," and "three drives to a top (bottom), and "three domed houses," are all phrases describing the structure known in EW theory as an ending diagonal This is a pattern that I see every day on some time frame of the markets I am watching. You will find it every day in stocks, indices, currencies, metals, oil, grains. The fact that it is described in EW theory should not minimize the value of this pattern and the ability to recognize it. Geometry, no, but EW ... yes. In fact, here is another shocker: You could even say that in addition to EW I am also influenced by Gann. Gann once said that the most profitable place to enter a trade is after the first reaction off of an important high or low. Not an earth shaking concept, by any means. But if you thnk about what I am doing with respect to the H-L-LH and L-H-HL, I am looking to enter a position after the first reaction off of what may be an important support (bottom) or resistance (top). And here is another suprise: Why do I usually play for two targets? Well, for that answer you need to look at EW. Let's take a short trade as an example. Price rallies into a high, and it then starts a decline. We call the stopping point of that decline a Low. Now, if price breaks the previous high, I am a buyer. I love buying higher highs. I like to buy high and sell higher. But, if price rallies off of that reaction low and stalls prior to making a higher high, we thus have a potential lower high. The initial high may prove to be an important resistance level. The first decline into the low is the first move down from that important resistance level, and the rally into the lower high is, you guessed, our first reaction from an initial break down from a potentially important top. We sell short if it breaks to a lower low. In EW terms, the price movement down from that H to the L is potentially a wave 1. The rally from the L into the LH is potentially a wave 2. If this is going to be an impulsive move, we should see a decline into a wave 3 low, where I will have my first profit target. Wave 3 would be followed by a wave 4 rally, and wave 4 will resolve into a wave 5 decline into a lower low where I have my PT2. Sorry if you find this shocking, but I have said many, many times that I am not at all an original trader. I have simply taken the few useful pieces of a whole bunch of useless "mind manure" excreted by the others's egos, and I use what is valuable and useful, and I have thrown away the rest. S/R is where price is going. Everything else helps me navigate the treacherous middle of nowhere. Below I have attached four pictures: 1 & 2: These are two diagrams from the EW pamphlet that I have found useful Again, I do not count the waves, etc and so on. It is enough just to recognize what is going on. If you find them useful, great. If not, that's great too. 3: I have attached a copy of yesterday's EURJPY chart showing what I describe here with respect to trading for PT's and how EW relates to what I do. This is the trade I am for which I am on the hunt. This is the price movement I am trying to capture and from which I am trying to profit. The size of that initial price movement determines the size of the targets. I use S/R to identify target zones and EW & Fibs to plan actual limit orders. 4: Here is a copy of one of yesterday's GBPUSD trades. If you go back through this thread, take a look at how often and fairly precise my profit targets are when price does move to and through them (though I do have many trades that reach only the first target and a few that reach neither). I say this not to make myself look smart, but to indicate that perhaps there is indeed some value to material that many dismiss out of hand. I do not want to turn this into an EW thread, as I am not an EW ideologue, and I am not going to answer questions about the theory. You can choose to use it or reject. Either way you should still be able to figure out and learn how to do what I have been trying to show here in this thread. Best Wishes, Thales

I'm thinking at best this would have been a break even effort, and at worst I would likely have taken a -6 tick loss. Best Wishes, Thales

I'm not trading, but here goes the GBPUSD again. Best Wishes, Thales

And here is a case where being too aggressive with the stop would have cost me a trip to PT2. Price pulled back to within 2 ticks of entry and then rallied strongly right to he secon PT. It happens. I was perhaps a bit too anxious to show MidK that not every trade needs to be for +.5R. Like I said, my best results over time have been with moving my stop to BE once PT1 is printed, and then wait for TP2, trailing at natural stops along the way should any be forthcoming. Best Wishes, Thales

Weekend Reading It is with fear and trembling that I recommend Frost's & Prechter's Elliot Wave Principle. Elliot Wave theory can be very dangerous in the hands of human creatures, as we are creatures who seek control and certainty. If you choose to read Elliot Wave, focus on the wave patterns, and do not allow yourself to get sucked in to the near "mysticism" of Elliot Wave that many folks do. All you need to know is the difference between impulsive vs. corrective price action, and how price displays itself during terminal movements. I use the fib stuff also, but only in conjunction with real S/R. I do not want to see folks posting wave counts here. This is not about using Elliot Wave to predict the end of Western civilization as we know it. Read this material as a guide to recognize certain variations in price action, not as a mystical guide to the universe. I also want to thank my currency trading friend, who I know reads this thread but refuses to participate in it, for sharing this .pdf booklet with us. I hope I do not come to regret sharing this here. Do not allow yourself to be seduced by the author's promise of the ability to forecast. Do not start counting waves. Do not rush out to buy the complete book. This is as far as you should have to go with this material. I hesitate even to press the "submit reply" button. Well, here it goes. Best Wishes, Thales Elliot Wave Basics.pdf

Second 1/2 would have been stopped at +14, so total trade = 21 or 1.3R Best Wishes, Thales