Week 5 EURUSD Analysis

I am taking a bearish view for EURUSD for the week.  Expecting price to retest 1.3450 region and if the support do not hold, 1.3100 is a possible target in the mid term.  Week chart shows possible formation of right shoulder and when the reversal pattern is completed, I am expecting price to go back into the range as shown on the day chart.

(Note that the prediction is just a trader's imagination of how price might develop, more importantly is that the trader has plans ready for the market at real time, and there are a lot more other factors to determine if the trader can profit from the prediction)

Week 4 AUDUSD - Pivot points and 123 reversal pattern

Did a classic intraday trade today using 123 reversal patterns and pivot points for AUDUSD.  The ability to interpret price action would give us an edge and notice my early entry and the more confirmed entries.

Week 4 EURUSD - Trend Line Bounce Entry

In the world of price action trading, this is the classic trend line bounce trade where price attempt to go low before breaking high again.  This is extremely common in Forex market.  I did a short on when the first M15 candle dropped from the high and took 40pips on first half of size and 20pips on second half when market refused to go down any further.

And because market is not going down further (bounce from TL) and after the H1 candle closed, it tells us that the market is most likely to be still up.  And thus the possible down view was invalidated.  Below is the chart to show how we could get into such entries

Trader's Time Frame

I am a full time Forex trader and have been conducting workshops at Singapore Management University (SMU) and at Traders Round Trable (TRT).

During the workshops, one of the frequently asked questions is about trader's time frame.  Or rather, when the question is popped, it is normally "What time frame are you trading?"

I did not find it easy to answer as most people would already have a fixated mind that a trader should have a specific time frame, which I cannot fault them.  My experiences taught me something different.

Commonly, we do need a specific time frame for our planning, but we need to go to both higher and lower time frames to look for information to support our planning (Multiple Time Frame Analysis).  And when comes to execution, usually we would go to lower time frames simply for the reason that we need more detail information from the market and always need to reconcile back before the final decision.

The conclusion is that you would need the various time frame for different purposes.

In any case, knowing how to use the time frames are basic skill sets of a trader and this is just part of the foundation.  It would not be the key to turn your trading profitable, but it is an important and mandatory skill to acquire.  And this usually takes hundreds of hours to train.

Importance of Reviewing Your Trading Performance

IMHO, trading has to be seen as a full time job even if you are just trading part time.  And reviewing your performance is an extremely important activity.  Trading without knowing your own strengths and weaknesses is one of the most fatal mistakes that traders make.

I constantly keep track of my performance and making sure that I do not run into unnecessary losses.  Below is one of the metrics that I track for my intraday trading.

Performance based on R-Multiples.  
Noticed that most of my winnings came from good trades that return more than 1.5R and I have losses that are smaller than R.  My R (max risk per trade) is fixed for each cycle.  And the vertical axis is the amount of profit or losses I made over my equity.

My expectancy ratio for week 1, 2 and 3 are 1.71, 0.61 and 5.13 respectively

Week 3 EURJPY Analysis

When comes to trading, I always advocate to have the big picture in mind.  It doesn't mean that it will sure happen, but if the plan unfolds itself along the way, you need to ask yourself if you are in the market.

I have already profited twice doing intraday trades base on this big picture, it is still valid at the moment.  Still looking to long this pair until the market tells me that I am wrong.

Week 2 EURUSD Analysis

Taking one of my student's analysis.  Looks like there might be some up side for EURUSD for rest of the week until we have new information from the market.

Week 1 EURJPY Analysis

Technical analysis for EURJPY, updated on Thursday.

Price has found its base around 107.80 and moved up and re-tested the ceiling of the box yesterday.
We were looking for a reversal pattern inside the box.  This provided evidence that price is establishing its up flow, further more we already have higher high and higher low.  111.00 would be the immediate target.

[Friday update]
The plan did not work out.  Took a small position to long when price retraced to 109.00.  Hung there for several hours and eventually abort the trade with small losses and long GBPUSD instead.  Again, the read of the market is wrong, but manage to earn some profits and reverse the trade to short.

Week1 GBPUSD Live Trade

Good start for 2011, captured a nice trade on GBPUSD based on what was planned on Monday.  Price did a nice retracement, stalled and create an opportunity for a long setup.  News was at 5.30pm and entry was about 3 hours before it.

The news helped to propelled the price, thus having a good setup before the news is something that I always look out for.  This could be said as the "way" I trade news.  Actually, it is still based on price action as the chart is telling us price is likely to go up then down since yesterday evening.

Week1 GBPUSD Analysis

Good morning!  It's the first trading day of 2011.  I wish everyone a fruitful year in their trading journey.

To start with, I have a potential bullish view of GBPUSD for coming days.  I would try to keep up with my blog post if possible.