Trading is beginning to wind down for the holiday period. Be careful trading during periods of lower volume. I am off doing other things for a couple of weeks. If you would like to read a good book about the psychology of trading over the holidays, I recommend Trading in the Zone by Mark Douglas.Happy Holidays to everyone!!!I'll be back Tuesday January 8th 2013.Michael Bridgman www.privateforexcoaching.comQuestions - email Michael@privateforexcoaching.......
Trading is showing signs of being quite erratic this week. As we go deeper into the holiday season, trading volumes decrease and the chart setups are less clear. When this happens, it's best not to trade. You must be extremely disciplined to make money trading. During holiday periods, it's harder than normal, because the largest traders step away from the market, but they will be back! The CHF looked best to me of the......
It took a while to find a trade, but after the US economic news releases were out of the way, the AUD set up nicely, allowing us to enter with a small stop and a 4:1 Reward to Risk ratio. This trade was so easy to manage that I haven't marked in the "take profit" areas as the trade progressed downward. Very few trades are this easy. Always remember to move your "take profit" down to protect yourself against a sudden and very abrupt......
EUR looked good and had an excellent Reward to Risk ratio setup of almost 6:1 overnight. These are extremely attractive trade setups and hard to resist - if everything else adds up.The Asian session high and yesterday's high were at the same level. When the UK traders broke this level and then pulled price back, a familiar entry setup presented itself. Price had been stair stepping higher and the trade required a very small stop......
A common characteristic of successful traders is that they have found a strategy that works for them. This strategy enables them to trade with a high probability of success. They use this strategy methodically over and over with each trade. Trading is routine and almost mechanical to them. If a trade fits their criteria, they take it, if not - they walk away.A pervasive characteristic of unsuccessful and inconsistent traders......
After a very slow week and a short one for us, because we never trade NFP Friday, we found a wonderful trade in the EUR. It's been a frustrating couple of weeks as the pairs have not been moving as much as usual and nice setups have been delivering much less than we are used to. However the trading week ends with a very encouraging trade. I don't usually show critical areas on these charts, but my students will recognize its significance.We......
The AUD set up nicely with lower highs, a wash and rinse and a Reward to Risk of 4:1 to our target 2. Unfortunately the market had other plans and we made modest gains in what looked like a trade with lots of potential. The market move was quite shallow, but it gave us a clear reversal sign with a very wicky candle which coincided with another tool that we use. We always watch the market for familiar signals and trade accordingly. ......
Modest EUR gains to start the month of December. After a series of higher lows and luring in breakout traders, the EUR pulls back, then forms another higher low. It's unusual to see yesterday's high and the Asian session high so close together. The Reward to Risk exceeds our minimum 3:1 ratio to our Target 2. We enter long and patiently watch price test and retest the Asian and yesterday's high. Price begins to climb......
The EUR made a nice move from yesterday's high to its Asian session low before reversing. The signals were very clear and the Reward to Risk exceeded our minimum of 3:1 to our Target 2. The USD crosses move very similarly and it was more a matter of choosing your favourite setup.Always be aware of yesterday's high and low as well as the Asian session high and low. These are critical levels for intraday traders. This trade proceeded......
A familiar pattern emerged with a move above the Asian session high to lure in the breakout traders. Price then pulls back and chops back and forth between the mid and top of the Asian session range. The candles have an identical but opposite direction setup as yesterday. The Reward to Risk is greater than 4:1. We go long, price tests the Asian session high and yesterday's high before moving toward our targets. Unfortunately a very......
The market took its time to set up overnight amid a very light economic news schedule. The GBP looked good to the downside following two bearish candles with the second one being very wicky. By entering on the opening of the next candle , our reward to risk minimum of 3:1 to our Target 2 was available with a relatively small stop.Entering near the middle of a range is not a favourite entry point, but a series of lower highs......
The AUD made a series of lower highs. This trade just barely made our minimum Reward to Risk of 3:1 to our Target 2. The trade moved fairly quickly to our Target 1 and we always protect that level. I forgot to mark in the "take profit" levels on the chart as the trade progressed. Not a bad trade to begin the week. Note how 2 higher lows illustrate the reversal.Let's hope for a good week of trading. More positive......
Optimism returns to the market. The GBP had an exceptional session and was catapulted to the upside by the US traders. After a tricky 2 weeks, we are rewarded with a very large upside move. This trade could have been a loss, if the stop loss had not been below structure.Price made a familiar pattern of enticing breakout traders into the market, then pulled back. Our criterion of 3:1 minimum Reward to Risk was met. After......
The EUR which has been moving up all week finally gave us an entry. After making a series of higher lows, the UK traders test the Asian session high, then it pulls back down with all the news releases, forms another higher low, followed by a very bullish engulfing candle. With a stop below the higher swing low, and a reward to risk of greater than 3:1 to our Target 2, we enter long. We anticipate a test and retest of the Asian session......
The AUD continues to look clearest amongst the majors to trade. A very small stop loss combined with our minimum Reward to Risk ratio made this trade setup look attractive. The EUR and GBP continue to be too difficult to find an appropriate trade setup meeting our criteria. The AUD looked good, but it didn't give us many pips, and that's trading. We can only strive for what the market is willing to give us. A holiday in the......
The AUD continues to look clearest to me of the majors. After putting in a series of lower highs an entry is taken with a modest stop loss just above structure. This trade had a Reward to Risk ratio of 4:1 to our Target 2 - meeting our criterion of 3:1 minimum. The trade was a little slow to get going as price continued to retest the Asian session low despite already having closed below it. This is not unusual. Price......
The AUD pulled through and set up with a near 5:1 Reward to Risk ratio trade today. I'm not Aussie obsessed this week, it has just been an easier pair to trade that the other majors. Some weeks are tough to find trades and this was one of them. It's always nice to end the week with a positive trade.Although it wasn't until the US session got underway - the AUD set up nicely requiring a very small stop loss and a very acceptable......
With the pending news in the US session, FOMC and Dr. Bernanke speaking later today, I had hoped for a trending UK session, but didn't get it. The AUD looked good in this otherwise tedious session, but it did not offer the minimum 3:1 Reward to Risk ratio. There are cheap stop losses and there are conservative stop losses. There is no point in being cheap, getting stopped out and having a trade go to one's target because we were......
The AUD makes a nice move overnight. After 2 really nice weeks of trading, this week is proving to be a little more difficult. Although it looks like closing the AUD trade overnight at Target 1 was a little too soon, some trades work out that way.I would rather keep the majority of my daily target and miss out on some pips, than give them back by being too loose with my stop loss and undisciplined. Greed and poor trade management......
The EUR was a tempting trade after the German ZEW economic release. The other majors appeared too difficult to trade. The EUR although tempting did not meet our Reward to Risk ratio of 3:1 so we passed on the trade. As a trader, we must have rules and abide by them. If a high probability trade setup presents itself and meets our reward to risk minimum, we evaluate the trade. If the setup is less clear and does not meet......
The Aussie offered up a nice trade overnight with a greater than 3:1 reward to risk ratio setup. The EUR and GBP also looked good to trade at the same time, but did not meet our 3:1 R:R minimum.The AUD made lower highs toward the end of the Asian session, then dropped sharply as the UK traders began their day. After a pullback forming another lower swing high, followed by a very bearish candle an entry is taken with a stop just above......
The EURGBP set up nicely with a lower high overnight and confirmed the entry in advance of the GBP's big move. This pair has once again been very tradeable over the past week. This trade set up with a greater than 5:1 Reward to Risk ratio.Although the trade did not reach our Targets 1 & 2, we were very happy with the result.It's been another great week for trading, and we will be very careful not to give any of it back tonight. Always......
Beautiful trade setup and very active session - thanks in large part to the US election results. The Asian session was very active as the election results indicated President Obama was re-elected. As the UK traders began their session they sold off the EUR and after a pullback which resulted in a lower high with a wicky candle, followed by a bearish candle, an entry short is taken, with a stop loss just above the wicky candle high. This......
Lots of very important economic news releases this week, not the least of which will be the result of of the US Presidential election today. This could be a volatile week, so be careful and keep stop losses tight.The EUR set up for an excellent reward to risk ratio trade of greater than 5:1 but neither of our Targets was reached. After getting a quick surge to the upside and riding out a pullback that didn't threaten our initial stop......
AUD set up as a nice trade overnight. After initially dropping after the UK open and moving down near the Asian session low, it moves up with several very wicky candles pushing off the bottom. After a higher low is made and entry long is taken with a stop loss just below the Asian session low. Price moves up, pulls back and forms a series of higher lows...enabling us to move our "take profit" up with each swing. We close the......
A nice move down on the EUR once a lower high became evident. The breakout long traders got lucky, so we had to be patient. The CHF confirmed the EUR move and AUD also set up nicely.The UK traders faked short at the open, then reversed the EUR upward taking all the breakout longs along for the ride. Price peaked then put in a lower high with a hammer-like wicky candle. An entry short at the open of the next candle met our......
Very modest EUR trade gain to begin the week. A very rare trade placed in front of the news due to my not believing that the Italian Bond Auction would be a big market event and a 10 pip stop made the trade very affordable. With a better than 3:1 reward to risk ratio, a long trade is taken, but after Target 1 is obtained, we are closed the next candle, as we protect our Target 1 profits. Target 2 is also hit but without us.Last......
The EUR offered up a nice trade again, to end the week. As the UK session began, the European economic news was released and behind us. The next pending news would be in the US session. The EUR traded sideways then began to rise but did not take out the Asian session high. Price then reversed and a short trade was taken. This same setup is mirrored with the CHF confirming the trade direction. Price moves to the Asian......
Beautiful EUR trade setup with a reward to risk ratio of near 6:1. This trade offered 2 entries with very little risk for either. With no European economic news releases of consequence, a trade short is taken after the wicky candles indicated the top was in place. An alternate entry followed with a lower high and a bearish engulfing candle. The risk was removed early as the trade progressed down and our stop loss continued......
The GBP is once again showing signs of life. The EUR got away from us overnight, but the GBP looked good once the "wash and rinse" was completed. This trade was acceptable as it met our 3:1 reward to risk minimum criterion. A surprisingly bad economic news release out of the UK did nothing to dampen the rise of the currency. After our entry, price rose to our Target 1 level and pulled back forming another higher swing low. As......
A wonderful way to start the trading week! There were lots of trades that set up during the UK session. The EUR is usually my first choice - if all things are equal. After testing the Asian session low and pulling back somewhat gently, our trade set up. With a stop just above the pullback high and a greater than 4:1 reward to risk ratio to our Target 2...(meeting our 3:1 RR minimum), we enter short. Price pushes through......
A relatively sedate end to the week. The EUR continued to make lower highs and after not re-testing the Asian session high, we chose to go short. There wasn't any EURO economic news releases scheduled, and the EU Economic Summit moved into Day 2 (yawn). The trade enabled us to have a very inexpensive stop just above the Asian session high, and our concern was to get through yesterday's low and the Asian session low without being whipsawed.......
The UK session didn't offer any acceptable reward to risk ratio setups overnight. When this happens, it's best not to trade and come back tomorrow. Once the Spanish bond auction news result was released and the EUR started to move up, the stop loss would have been approximately 26 pips and Target 2 was approximately 50 pips away. Our minimum is 3:1 meaning we needed Target 2 to be 78 pips away from our entry. We also don't like......
Commodity pairs made large moves overnight. Both the CAD and AUD strengthened against the USD. The AUD is usually easier to trade and it set up with a very low risk trade. Once all major economic news releases were behind us, we entered long with a very cheap stop, giving us a 4:1 reward to risk ratio trade setup. Price moved up above the Asian session highs and continued to Target 1 and up to Target 2. At Target......
The EUR set up nicely for us once the German ZEW release came out. After a large news candle down - a bottom was put in and the EUR moved up to our Target 2. Protecting our profits as the trade moved in our direction as always...we captured a better than 5:1 reward to risk trade. When you spot these...they can really help make your weekly trading goals.Off to a good start for the week.See you tomorrow.Michael www.privatef......
The CHF looked better to me last night than the EUR. There was no significant economic news for us to wait through. A very inexpensive stop coupled with a greater than a 5:1 reward to risk makes this trade very attractive. Moving our stop down to just above the lower swing highs keep us in profit and our Target 1 and 2 are hit on the same candle. The concerns for this trade were getting through the Asian session......
Quiet trading overall in the UK session, but we managed to squeeze some pips out of the AUD. The Aussie dollar had been making higher lows and once the breakout traders jumped in long after the UK session got underway, we waited for the pullback. This entry allowed us to enter with an 8 pips stop loss and a better than 5:1 reward to risk ratio to our Target 2. The trade progressed fairly quickly allowing us to remove any risk and place......
It appears that the EUR will be making headlines this week, but the AUD set up nicely for us overnight. After initially moving down as the UK session got underway, then consolidating, it retraced upward...forming a lower high with wicky candles as it ran out of upside momentum. We entered short with a stop just above the lower high, with a reward to risk ratio of better than 4:1. After zipping through the Asian session low and barely......
The EUR made it to both our targets today, but without us. There was a lot of news pending for the GBP, EUR and USD overnight. Price chopped back and forth in advance of it and then reacted positively with the EUR making it to and beyond the 1.3000 level. Expect this level to be tested and retested as it is a major psychological level. Although the EUR appeared to be making higher lows as the UK session progressed, I chose to stay......
A little quieter overnight with no significant EUR economic news. After another quiet Asian session, thanks in part to China being on holidays all week, a favourite pattern emerged as the UK traders came on. The European traders had taken the EUR up starting their session and the UK traders took it down - through the Asian low then snapped it back up after luring in the breakout traders. Although neither of our targets were hit,......
EUR sets up nicely with a better than 5:1 reward to risk to begin October. No significant European economic news releases to keep us out. This familiar pattern set up after a quiet Asian session enabling us to enter the trade and progressively move our stop loss level to "take profit" as the EUR stair-stepped upward forming higher lows and reaching our Target 1. This was an excellent trade to start the short week. I do not trade......
It's always nice to end the week with one more positive trade. The EUR set up beautifully for us overnight. When price got going, it not only blew through the Asian session low, it took out both targets 1 and 2 in quick order. September has been a very good month and summer seems like long ago.The EUR trade setup overnight is a favourite of mine, and one I train my students to look for each session. When you find this setup,......
GBP sold off ahead of the UK economic news releases. Once the news was out, it moved back up. After the higher low, we entered long, on the opening of the next candle with a stop just below the higher low. We are risking 16 pips for a potential reward of 58 pips...Target 2. This meets our minimum criterion of 3:1 reward to risk. Our first level of concern will be the Asian session high and then yesterday's high. Price......
Not a lot of news overnight, but the lower highs on the GBP had us looking for the opportunity to go short. With an affordable stop just above the plunging bearish hammer, we enter short at the opening of the next candle. The reward to risk to our Target 2 is 4:1 easily meeting our criteria minimum of 3:1. Price chops sideways for over an hour attempting to stay below yesterday's low. Once price moves convincingly toward our targets,......
The Asian session range was larger than usual. No significant news was pending during the UK session for either the EUR or GBP but ECB President Draghi was scheduled to speak later in the session.The UK session began with some choppy sideways price action before putting in a higher low. We enter long with a stop just below the Asian session low... giving us a reward to risk of 4:1 to our Target 2. We anticipate a run up to test the Asian......
Having learned a long time ago not to trade in front of the news, it always nice to capture some pips when the reversal occurs. As long as the signals are clear - as was the case overnight with the EUR... one can capture the safer move.The GBP news can affect the EUR as it did overnight. The reverse is also true. If the sentiment for the Eurozone is negative, the GBP typically is sold off too. Last night, traders were awaiting......
Huge moves in the Asian session across the majors, left us without any high probability trade setups that would meet our reward to risk ratio. It's a little unusual but the Asian session had huge moves yesterday. When this occurs, it signals to me to take the session off. I only look for high probability trades that meet my trading criteria and reward to risk ratio. I pass on anything else. Never trade for the sake of trading.......
A GBP trade setup once again! This is my favourite pair to trade. The EUR has been much easier to trade lately, so it's nice to finally find a trade with the GBP. No surprises from the MPC Meeting Minutes and lots of activity just in advance of the UK opening..."railroad tracks" candle formation. With a lower swing high and no breech of the Asian session high, the pair set up as a short, with minimal risk, meeting our reward to......
Rules, rules, rules. If the trade setup is not there, don't trade! This is a profession where we don't get paid to show up at work. We get paid if we are right. We dramatically increase the probability of being correct in our assessment of the market by following our trading criteria for high probability trade setups, exercising sound money management and reward to risk. If we can't find a trade that......
A frustrating UK session ends the week. Rules are hugely important in trading! Plan your trades and trade your plan...as they say. Some sessions will result in high probability trades and some won't. Once you know what to look for and take only those trades, your success and consistency goes way up! Don't take trades that don't meet your criteria. If they don't meet your criteria, they are low probability trades......
The UK session was very quiet as the markets await the FOMC outcome from Dr. Bernanke. The EUR offered a low risk trade with a familiar setup. Neither of our targets is hit, but we can only get what the market offers.Let's see what tonight brings.Good luck in your trading.Michael www.privateforexcoaching.......
