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pipsaholic

Reasons To Enter A Trade

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Hi,

 

Would be interesting to know what reasons/criteria traders use to enter trades. I trade the major spot fx pairs. I use MA for trend, round numbers, plus support and resistance on HTF plus candlestick formations with MACD for divergence sometimes trendline’s if they meet up 3 points.

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Surely the only reason to enter a trade is to make money, right?

 

I am studying price action with a simple EMA to help decide when the probability for a profitable trade is coming up. If it doesn't work, I get out quick. :)

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Hi,

 

Would be interesting to know what reasons/criteria traders use to enter trades. I trade the major spot fx pairs. I use MA for trend, round numbers, plus support and resistance on HTF plus candlestick formations with MACD for divergence sometimes trendline’s if they meet up 3 points.

 

I check the overall trend (ichimoku clouds), which way the speculators are betting (CoT report), trendlines, support/resistance lines, candlestick formations

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I check the overall trend (ichimoku clouds), which way the speculators are betting (CoT report), trendlines, support/resistance lines, candlestick formations

 

 

Cool, do you find the COT report useful do you use an indicator I am learning how to read it do you require to calculate it manually I found this website am I right and saying I look for the green line to go with the large non commercial speculators rather than hedgers or small specs?

 

Charts | Timing Charts

 

Do you select the currency pair as it states or are we looking at euro future? As fx doesnt have a central exchange?

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Yes you should be following that green line.

I don't use it as an indicator for intraday trading because that is a weekly report and it does not show pairs separately. However I find it extremely useful because it shows the main trend. I just follow those "deep pockets"

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Does the blue or red line have any significance? or just ignore it? do you look at both fx futures and euro/dollar pair on this site or just 1??

 

Also, i got this info but it baffels me:-

 

3-MONTH EURODOLLARS - CHICAGO MERCANTILE EXCHANGE Code-132741

FUTURES ONLY POSITIONS AS OF 01/10/12 |

--------------------------------------------------------------| NONREPORTABLE

NON-COMMERCIAL | COMMERCIAL | TOTAL | POSITIONS

--------------------------|-----------------|-----------------|-----------------

LONG | SHORT |SPREADS | LONG | SHORT | LONG | SHORT | LONG | SHORT

--------------------------------------------------------------------------------

(CONTRACTS OF $1,000,000) OPEN INTEREST: 7,662,714

COMMITMENTS

362,301 806,161 1528252 4964207 4374131 6854760 6708544 807,954 954,170

 

CHANGES FROM 01/03/12 (CHANGE IN OPEN INTEREST: 72,740)

96,173 -29,358 47,640 -170,280 66,069 -26,467 84,351 99,207 -11,611

 

PERCENT OF OPEN INTEREST FOR EACH CATEGORY OF TRADERS

4.7 10.5 19.9 64.8 57.1 89.5 87.5 10.5 12.5

 

NUMBER OF TRADERS IN EACH CATEGORY (TOTAL TRADERS: 235)

38 54 75 125 124 208 214

 

 

EURO FX - CHICAGO MERCANTILE EXCHANGE Code-099741

FUTURES ONLY POSITIONS AS OF 01/10/12 |

--------------------------------------------------------------| NONREPORTABLE

NON-COMMERCIAL | COMMERCIAL | TOTAL | POSITIONS

--------------------------|-----------------|-----------------|-----------------

LONG | SHORT |SPREADS | LONG | SHORT | LONG | SHORT | LONG | SHORT

--------------------------------------------------------------------------------

(CONTRACTS OF EUR 125,000) OPEN INTEREST: 294,263

COMMITMENTS

29,770 184,965 1,131 231,765 50,103 262,666 236,199 31,597 58,064

 

CHANGES FROM 01/03/12 (CHANGE IN OPEN INTEREST: 11,473)

-10,671 5,615 199 18,780 3,187 8,308 9,001 3,165 2,472

 

PERCENT OF OPEN INTEREST FOR EACH CATEGORY OF TRADERS

10.1 62.9 0.4 78.8 17.0 89.3 80.3 10.7 19.7

 

NUMBER OF TRADERS IN EACH CATEGORY (TOTAL TRADERS: 183)

28 82 14 48 45 88 129

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Don't ignore other lines completely but remember that sum=0

 

Speculators

Long:29770

Short:184965

Net:-155195

 

Commercials

Long:231765

Short:50103

Net:181662

 

Nonreportable (small traders)

long:31597

Short:58064

Net:-26467

 

-155195 + 181662 + -26467 = 0

 

The important thing to watch is how the numbers change, ie turning points, huge position changes. That should help you identify when trend is starting or ending

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That may come handy to identify support/resistance zones...you can somehow see the levels that they increased their positions...

for example, big portion of euro comes from eurusd so i think 1.3040-1.2950 zone will be tough to crack...

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You want to trade with the trend - simple!

 

I found this combination of the Parabolic SAR and MACD histogram very useful. Enter long when the Parabolic SAR line moves below the price and the MACD histogram crosses up from negative to positive territory. Go short when the Parabolic SAR line moves above the price line and the MACD histogram moves down from positive to negative territory.

 

Best of luck!

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You want to trade with the trend - simple!

 

I found this combination of the Parabolic SAR and MACD histogram very useful. Enter long when the Parabolic SAR line moves below the price and the MACD histogram crosses up from negative to positive territory. Go short when the Parabolic SAR line moves above the price line and the MACD histogram moves down from positive to negative territory.

 

Best of luck!

 

I think people may have a better idea if you add some charts, or maybe you can start a new thread...

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