Follow the EUR/USD Yellow Brick Road

After a suggestion was made to me, instead of having a seperate thread everyday I will just have one thread, so its easier to bookmark if you wish.

Tuesday 28th Oct:

1 hourly chart shows we are in a consolidation period, we could even have made a short term bottom.
15 min chart show 1.2500 is a nice 38% pullback of the overnight rally, and also close to the daily pivot at 1.2496. Entered long here for a initial target of 585, stop just below the 50% for a 50 pip risk. Charts etc on my blog.

Not happy with this setup, price is consolidating at the lows, indicating further downside.
Closed long for -14, re-entered short at 1.2485

I think you've been unlucky here. See the 1hr screencap, price was in a downtrend but then made an Equal Low to the LL at that 2332 area (an effective double bottom) before making an equal LH at the 2588area before finding support inbetween the 38.2 and 50% fib of the move uup from the eq L to Eq LH at the previous 1hr minor swing Hi's circled in green.

Strictly speaking per peak/valley price action anlysis you were neither entering an uptrend or downtrend on this 1hr chart as a downtrend should have ideally seen a LH and an uptrend a H not an Eq LH...this said in this consolidation the upside looked more likely as price found support at the previous 1hr minor resistance area, a case of RBS (resistannce becomes support.)

Price remains inbetween the double bottom and Eq LH as I write this.

Just an opinion.

G/L

Yep this is very tricky at the moment. No real clear direction. I still feel that ultimately its heading down but question is how far will it retrace. I can see it getting to 625 potentially before plummeting.

About to enter short, want a retrace to 515 though...

Got it, well 509 anyway, targets my usual fib levels, 460 (met already) and 429

Reached 460, and consolidated at this level.
I would now like to see it fall within the next 10 mins or so. Otherwise I may exit to avoid getting caught in a pullback.

Terrible day yesterday, what annoys me most is that every single one of my losing trades was in the green at one point, but did I take profits, did I heck!!

Areas to watch for a bounce today are 647-662 area.

I've just seen this thread, so all the best with this, Andy. I am also looking to start day-trading currencies and thought that EURUSD was the best place to start given it's the biggest and most liquid pair etc. Though I'm not sure that a daily target for just one pair is a good idea initially, but 30-50 pips average across major pairs seem reasonable eventually, to my novice eye from what I've read elsewhere on the board.

Is there a single post somewhere that details your strategy/game plan etc?

I haven't put one together yet, but quite like the idea of using more than one timeframe to get the overall trends etc, so the 3 Ducks systems may come in there, and using common sense regarding support/resistance, candles, breakouts after overnight asian ranges, and so on.

Keep up the good work, and good luck.

Hi Donkers, not really had the time to document my strategy, but if read through the posts on my blog I have tried to explain my thinking.

Donkers said:

I've just seen this thread, so all the best with this, Andy. I am also looking to start day-trading currencies and thought that EURUSD was the best place to start given it's the biggest and most liquid pair etc. Though I'm not sure that a daily target for just one pair is a good idea initially, but 30-50 pips average across major pairs seem reasonable eventually, to my novice eye from what I've read elsewhere on the board.

Is there a single post somewhere that details your strategy/game plan etc?

I haven't put one together yet, but quite like the idea of using more than one timeframe to get the overall trends etc, so the 3 Ducks systems may come in there, and using common sense regarding support/resistance, candles, breakouts after overnight asian ranges, and so on.

Keep up the good work, and good luck.

Click to expand...

I guess maybe you did not really browse a lot on the forex currency pairs. Euro-usd is not the most liquid, but take a look at gbp-jpy it can make 200-300 pips within hours. And there are times it move 1000 pips a day. :cheesy: just want to share with you the violance nature of gbp-jpy

I chose EUR/USD as its the most widely traded. The JPY is too volatile for me for the time being anyway

Yeah i guess Eur-usd is the most ideal pair as it is one of the most carefully and technically traded pair. Good spread and the volatility just nice not too small not too big. It's everyone's favorite including me.

Changed my tack a bit now. Always looking to improve
anyway 2 trades today +10, and +25. So that is my new daily target of 25 pips met.
See my blog for more explanation.
AND before I get any more abuse, I am not priming you all in order to sell you something later on. The reason for my blog is to record my thoughts and actions, so that I am able to review it at a later date. And maybe help others too. I think its great that we have such a good community here and some great people willing to share ideas

Entered short on a break of the 50% fib at 1.3047.
Target was 1.3000 the 61% fib.
My trailing stop got me out at +10

Again see how the fibs act as great entry and exit points.

Hi Andy

Well done. Do you use other support and resistance levels across various timeframes, as well as MA'a, oscillators, candles, other TA, news/fundamentals, or are you trading purely on Fib pullbacks on the one currency pair? cheers.

Donkers said:

Hi Andy

Well done. Do you use other support and resistance levels across various timeframes, as well as MA'a, oscillators, candles, other TA, news/fundamentals, or are you trading purely on Fib pullbacks on the one currency pair? cheers.

Click to expand...

Hi, Donkers, I like to keep it as simple as possible to be honest. I've tried many indicators and found they sometimes work, but you can't rely on them solely to trade. Price action is key. I subscribe to the 'no indicators brigade!'
Well the only indicator (if you can call it one), I have is a daily ATR to give me an expected range.
I will draw fibs on the hourly chart, normally the previous day swing high to low, and then often also a fib of the last swing move. I may also have a larger fib from the hourly or even daily. I then use these levels to base my trades around. Normally a break of a 38% fib will see price move to the 50% etc.
My latest method is to try and jump on one of these moves, and bag a few pips quickly whilst getting my stop loss to breakeven as quickly as possible. As you study the price action around fibs you will often see that price does move pretty quick once a level breaks.
In terms of other sup/res I will normally mark the prev days high and low, and also the daily pivot level. You might also see a trend line or 2 if obvious points exist. Remember a trend line is only a true trend line which you can believe in when it is touched at least 3 times.
So as you will see from my charts I try and keep them as simple as possible

So in brief, price action - is the price forming higher high, higher lows (uptrend), or is it forming lower highs, lower lows (down trend), or is it consolidating.
Then play the moves between the fib levels.

I started my blog a week ago to log all my thoughts and trades. I hope to keep this going and in 6 months time to be able to see how far I have come

Frontier:

Despite your comments on the volatility of GBP/JPY (here and on your excellent blog), if it is not too indelicate a question, have you succeeded in making - and keeping, money from it?

Andy: For what it's worth, I appreciate your blog, and have no reason to think there is any ulterior motive. Other than learning by our own experience, learning by someone else's is the next best thing!

Regards,
M.

montmorencyt2w said:

Frontier:

Despite your comments on the volatility of GBP/JPY (here and on your excellent blog), if it is not too indelicate a question, have you succeeded in making - and keeping, money from it?

Andy: For what it's worth, I appreciate your blog, and have no reason to think there is any ulterior motive. Other than learning by our own experience, learning by someone else's is the next best thing!

Regards,
M.

Click to expand...

I ditto your comments, andy, keep up the good work...w/d

Thanks guys, I hope we can all learn from each other