The short trade with the GBP-USD has hit my adjusted stop now, giving me a very small profit.

My last 2 trades have gone reasonably well into profit only to give back quite a large % of the gains. This is not so easy to deal with emotionally, but it is necessary if you want to take advantage of the occasional big move in your favour.
Making the decision when to close a trade can be more difficult than deciding when to enter one

Hi Michael,
I am certain that all indicators and especially the Bollinger bands are much more reliable with Forex than they are with shares. The Forex market is open 24 hours a day, 5 days a week. Shares are only traded for about 8 hours a day, depending on which market. 4 hour charts are absolutely useless with shares as there are only 2 candles per day. Because of the daily opening gap, you could almost say that every day you have 1 @ 4 hour candle and 1 @ 20 hour candle. 1 hour charts are not much better.
As most indicators work on averaging the previous x amount of time periods, the daily opening gap will mess up the calculations. At least with Forex, there is only 1 Gap per week.
I don't know why it has taken me so long to realise this

Don't work too hard

Keith

Although I don't really expect a trade possibility with the EUR-JPY to form for a few days, I just want to jot down some of my thoughts as this is back on my watchlist again.

Looking at the daily chart, the main trend is bearish.
We had a reversal signal, convergence with the MACD (and RSI) which has worked, but the bulls were stopped by the last significant high which has formed a double-top.
The Bollinger bands are now practically horizontal and parallel. This, coupled with the double top, suggests to me that this is most likely to be a period of consolidation and that the market will continue with the major downtrend.
Of course, if the price goes up and breaks the double top resistance ( only about 70 pips), this theory goes out of the window
There is a support line on the Daily chart and if broken, may indicate a short trade set up, but I will make a decision if/when that happens.



On the H4 chart, there has already been a break of RSI support that did not work at all! The bulls were just too strong. The RSI does suggest that this pair is now in overbought territory though.
I have drawn a resistance line, but I'm not totally sure about it. The first 2 points that I used are 16 time periods apart, then the price didn't go anywhere near it again for 42 periods. However the price has flirted with this line for 3 candles but failed to close above it.
If the price fails to make a higher high, then there will be a convergence with the MACD.
The support line that I have drawn is really too steep and I would not rely on a break of this to indicate a short entry.
Ideally, I'd like to see if the price movements can allow a better looking support line to form before going short.



There is divergence with the MACD on the H1 chart. A break of the support line and the BMB may present a shorting opportunity with a stop of about 40 pips with an 80 pip target.

I was looking for a shorting opportunity with this pair.

The current H4 candle is now trying to break support and the BMB. At the same time, it is testing the broken resistance as support. If this candle closes lower than it is, there will also be a break of the RSI 50.



The daily candle is showing reaction to and is just above the bollinger middle band.



It just may be too risky to go short right now.

I didn't take the break of support with USD-CAD H4 yesterday as the price was still just above the BMB on the Daily chart at the time.
Following the support break, the price did go down for about 50 pips before retracing. The long lower wicks on the candles following the support break show that the bulls were not giving in so easily.
Yesterday's daily candle closed as a bearish engulfing candle following the break of the BMB. A good reversal signal. Or in this case an indication of continuation of the overall downtrend. There has been a break of RSI support as well. Again, the fairly long lower wick on the daily candle does suggest that there may be a bit more tussling between the bulls and bears.
While the daily price remains below the BMB, I have more confidence to see if the H4 will suggest a new short trade set-up to me.



The H4 is not too much help to me at the moment. I can't see that I can draw an unbroken support line anywhere.
I'd like to see the price test the broken support or at least a good signal at the BMB before making the decision whether to go with the short position or not.
I'll just have to wait and see what happens

Hi all,
I'm back again after being off line for a while.
Since my last post re USD-CAD...
unfortunately the retesting of the broken support or BMB never happened, so I missed out on the 200+ pips downmove. C'est la vie



What surprises me about myself, is that I don't feel bad about this
Conditions weren't solid enough for me to confidently open a short position, so no regrets.

It has been said that when one can be just as un-emotional about their losses (or perceived loss in this case) as they should be about their wins, they are well on the road to mastery.

Vincent

The Canadian Dollar has been going from strength to strength.
CAD-JPY daily chart shows the strong uptrend.
There was a bearish engulfing candle at the break of the bollinger upper band a while back. The bears have tried to take control following this, but the long upper and lower wicks on the most recent candles do indicate uncertainty.
With no clear indication of a trend reversal, it makes sense to look for signs of a continuation of the strong uptrend. A testing of the bollinger middle band is possible, so a bearish move of about 150 pips could happen before the continuation.



The H4 chart looks to have formed a quite nice resistance line and has shown good recent reaction to it. There has already been a break of RSI resistance.Also moved above RSI 50.
However the bollinger bands have tightened and are now more parallel and horizontal, not a good time to trust a break-out as there could be more sideways movement to come.
I would like to see the price go down, without forming a new recent low and then the bulls come back with a forceful break of this resistance while the BB start to widen again or at least turn upwards.
I will see what happens, but a wishy washy resistance break will be ignored by me for now.

Thanks Vincent - I still have a long way to go to achieve Mastery, but I do feel that I am improving a degree at a time

Keith

I posted about CAD-JPY a few posts back.
Unfortunately the price didn't go down before breaking the resistance, so I never took the long position. A 1:0.75 position would have given a small profit, but a 1;1 would not have.
The price has now made a double top on the H4 at around 93.70 and looks to be ranging with a possible treble bottom forming at around 92.20. There is also a possible divergence forming with MACD.
I still feel that it is more likely that this pair will continue the strong uptrend. The last completed candle with the long lower wick and almost a Doji does indicate that the bears are running out of steam. The current candle is only 30 minutes old, but if it closes as a bullish engulfing candle, it may be worth looking for opportunities to open a long position with the smaller time-frames.



On the H1,
there is a resistance formed, but it does seem a bit on the steep side.
It's looking very possible that the current candle will form a resistance break on the RSI
I'm unable to make up my mind about this one, so I will probably not take this resistance break if it happens.
Should the price show reaction to the line, bounce down and form another low, I would have more faith in this line and reconsider the position

I've been in Laos for a few days, so a bit of catching up to do

It's really difficult to define a trend with the USD-JPY at the moment.
On the daily chart the movements seem to be in a ranging channel. There is a looming support break, but with the tightening bollinger bands and the current indecision around the RSI 50 level, I don't think that the daily chart currently supports either a long or a short position.
However, the price has broken below the BMB and is possibly forming a sell signal currently. A bearish candle following a spinning top doji that straddled the BMB.
This is enough to look for any opportunities for a short position in the smaller time-frames.



On the H4 chart, convergence has formed with the MACD and RSI, RSI has moved below 50, so a good time to look for a shorting opportunity. But there is no way that I can draw any sort of support trendline at the moment.
The last candle did close below the recent low, but it was so close to the BMB so not a position that I could have confidence in. Really I need to see the price rise and form a support before taking a short position.
Just keeping an eye on this one for now.

The AUD-USD weekly chart shows that there has been a very strong uptrend but is possibly now moving into ranging mode. The bullish candle of 2 weeks ago was unable to make a new high, but the MACD could possibly form a much lower high. Too early too be sure yet though.
The tightening and parallel bollinger bands do indicate a period of consolidation. If the market is ranging, then it is at the top of the range and so not unreasonable to see if there are any short trade set-ups forming



The daily chart is looking quite good.
Divergence has formed with the MACD (also with RSI, but I have not drawn the line)
A support line has formed. I wasn't quite sure about this support, but Monday's candle opened below it, but was unable to break it at close. Tuesday's candle was bullish, but unable to form a new recent high.
Today's candle, only about 6 hours old is trying to break the support line, but of course a lot can happen before the end of the day.
Should today's candle close below the support and the bollinger middle band, it will certainly also move below RSI 50, I will be opening a short position.
Stop would be about 0.9400 and T1 around 0.9040

Continuing from the previous post.

I was prepared to short this pair if there was a break of the support trendline on the Daily chart.
Although Friday's candle spent most of its time below the support, the bulls rallied towards the end and the candle close was above support.
The long lower wick (is that a Dragonfly Doji?) shows that the bulls aren't ready to throw in the towel just yet, so should today's candle close below the support line, I am unlikely to open a short position based on the daily chart at the moment. The MACD divergence is still intact, so I will continue to watch this pair and see if an opportunity to short will present itself.



The H4 chart shows a bullish engulfing candle following a break of the lower bollinger band. A reasonable resistance line is formed. There is no MACD convergence and there has been an RSI resistance break already. Also RSI moved above 50. So the H4 actually suggests looking for a long trade set-up.
While there is this obvious conflict between the daily and H4, it is probably best to wait and see.



On the H1 a long trade set-up has already been formed. There was a small MACD convergence. There has been a break of resistance followed by a retesting. The only thing against it is that the bulls are likely to run out of steam soon following so many green candles and RSI heading towards overbought.

The EURO pairs have been very erratic lately although the Euro is weakening overall.
With the EUR-AUD, the Daily chart shows a strong downtrend. There is MACD convergence formed, so maybe it is time for a small correction.
I have drawn a resistance on the chart, but at the moment it's not a line that I would trust too much. I will watch this pair and see if there is a break above the BMB and RSI 50 and maybe some candle pattern that suggests a long trade.



The H4 has recently formed a resistance line, but it is very new and maybe not to be relied on.
There was a fairly good reversal signal, a bullish engulfing candle after a push below the bollinger lower band.
I'd like to see the price go down for a while and another reversal signal before committing to a long position.

On the H4 the Euro-Aud did go down and has formed a higher low. There has been a 2nd bullish engulfing candle following the low and the current candle is breaking above the resistance and BMB. RSI is breaking above 50
There is still about 40 minutes before this candle closes, but I'm going back to bed and so have opened the trade.

Long position, 2% risk
Entry 1.4422
Stop 1.4260
Initial target 1.4560

This position did go 60 pips into profit, not quite enough for me to consider resetting my stop to B/E. The bears came back strongly and stop was hit.
Oh well - on to the next trade.

The CAD-CHF daily chart shows an extended divergence with the MACD and is possibly in the process of forming a small double top. It looks to have been trading in an ascending channel.
There waas a bearish engulfing candle following a break above the BUB on 9th April. This work to an extent but was stopped at the support line.
The relatively long upper wicks on the recent candles indicate possible weakness in the bulls developing. RSI is around the overbought area. No second reversal signal as yet though. Should the bears manage to take control, I would expect the support line to work once again.



The H4 does have a support line, but it looks far from perfect.
I will keep an eye on this for now, but maybe there will not be any opportunities until next week.

The AUD-CAD H4 chart caught my eye as I was scanning through the currency pairs.
This looks to have a very nice support trendline, and a possible short trade set-up is forming.
I looked at the daily chart and it looks to be trading in a narrowing range, but the bias is down. The daily also shows the price just below resistance and the MACD has hardly been able to drag itself above the zero line for many months.

Daily chart....



H4 chart....
I like to see the price react to a line at least twice before having confidence in it as a valid S/R trendline. This one ticks that box and the fact that the last high was was lower than the previous gives me more confidence should the price break below support.



But in a case like this, where the price can break support, but stay above the bollinger middle band, then I will also wait for a break below the BMB.
This is something that I am now starting to question. I cannot help but notice that quite often a break of the bollinger middle band is not significant. In fact when the price has touched the upper BB, the BMB often seems to work as a strong support zone (and vice-versa)


Apart from that I also see a support level at around 0.9290 to also urge caution, but here I am discussing the BMB.


I am at the stage where I can trade without losing money overall, but have a bit further to go before I can trade with confidence that I will consistantly turn a profit. I still have about another year as my goal was to be profitable within 2 years. As Vahid has posted in the FLMA main thread, one cannot be consistantly profitable until one has clearly defined strategies.
I'm still fairly confident that I will get there in the end

Hi Keith,

I really admire your dedication. I get much inspiration from your focused persistence, and read your thread religiously. I have no doubt that you are at the heels of many breakthroughs. For me the major quantum leap came when I found my own vision of price action. Mentally it was like giving birth to a child. I have taken bits and pieces from a number of places, and molded them into a personal methodology, nothing unique, but the application of them became uniquely mine.

I know you have a goal of living from Forex earnings. I am sure you are well on the way of achieving that. Stay with it and you will get there.

As Vahid says, the day will come when trading will get boring, and you will just spend the time doing the same thing, while watching the account grow. What a wonderful day that will be!!, but knowing human nature and its urge for excitement, we will then long for the early days, when we had so much fun learning.....

Stay Strong,

Vincent

Unfortunately we had a storm here, and after the house being hit by lightening and computer fried recently, I shut down. Didn't want to risk it happening again
This meant that I missed the move with CAD-CHF.