Journal Take 2 - Chart Patterns

[natureboy]

Well, i'll be shorting EURUSD under 1.2920, and that value will trail lower if prices continue on down. I'm off. Nice doing this. the nitty gritty, warts and all. i plan on trading well, carrying out my process in front of you guys. Most weeks, that will end in profit.

 

[natureboy]

well, i'm back. so much the better. after this i will be off for the day, though. EURUSD is just not plunging yet... I'm fairly confident it will hit that lower target either this week or next, then more upside. I'll change my mind in a second, i'm a trader. Still bearish under 1.29185 for now..

 

[natureboy]

ADR(5) has 1.2879 area as about as much as could be reasonably expected for today's trading

 

[natureboy]

Today's journal entries were not specifically aimed at achieving my stated goals with this journal. I'm more or less writing out what i'm doing and thinking in my trading today.

In future entries I will address the three main goals of having this journal.

EURUSD is chopping chopping....have another time target at 1040. It seems the 910 target was for the low that came in about 845 (they aren't exact).. So last effort selling would probably start around 1015-1040 as long as 1.2919 holds, i'm on board.

 

[natureboy]

Just as an aside, that gap in USDCAD was ideal. I missed it, but in a 20/20 hindsight 'look what was possible' picture - here's an objective pattern from USDCAD 5m from today. Gave the best price of the day for that up move.

 

[natureboy]

So again, there is a new W5 on EURUSD. This helps me hold on to my bearishness in the face of sideways price action. And helps me think that time target might be worth something. Does that sound like i want to be right? Look out kids, that's a bad jellybean.

 

[natureboy]

done. i'm out on the short. be back tomorrow. I plan to keep this journal going for at least two weeks. Money can be made, just not on every trade.

 

[wackypete2]

OK, I'm in

Peter

 

[natureboy]

OK, I'm in

Peter

Hell yeah

--

Day Two..

 

[natureboy]

So far there is a way asymmetrical W10 on 5m EURUSD. LTF Momentum is down, and we're headed into some 2am (in my time zone) area economic releases..

More bearish under 1.2930, via 15m direction tool..

EURUSD looks to be in a flag pattern on the hourly, i'll post that, and right now price is not at an upper or lower boundary, its in the middle. And that can be harder to work with.. At any rate 1) i need coffee 2) its looking bearish below 1.2930 with pattern failure (stop) at 1.2953

 

[natureboy]

The pattern stop can go just beyond the D point, a couple pips. If you get creative with say a Tick chart you can use moving averages to indicate the turn as well. Here's a 13 tick bar, at 23:31 EST, 50&200 SMA turned fast < slow.



That happened at 1.2943. This can decrease the entry to stop loss to closer to 10 pips instead of 20. This layering of timeframe/tick speed/bar size charts can be experimented with and its possible to have objective, repeating setups with stop losses less than 10 pips. Naturally, not every pattern works out.

This current pattern in EURUSD may not work out. However, the sooner you get it, the easier it is to be in profit and at least have the chance to take profits.

 

[natureboy]

Here's that 1hr Flag pattern it looks like EURUSD is in right now. I generally avoid trading the middle of these. I'll buy that next #4 low, or try to anyhow. The middle though - forget it. Same goes with triangles - very tough to trade in the middle of triangle (at least for me).



We are at a prior eyeball resistance on the 1hr, so this W10 pattern may work. So far, we're only at just above a 38% retracement of the price range A-D of the pattern. So, price could still reverse from here and go above D and it be normal.

 

[natureboy]

Time model has 1am and 4am as important.

For better or worse i'm short from 1.2937, Stop Out at 1.2951


--

Exits

I'm supposed to use a mixed bag of a Trailing Exit, trying to catch news-reaction intraday trends, or higher timeframe trends, and pattern based targets. The pattern targets are a percent of the A-D price range, more than one can be used. I also clearly have a built in running scared exit! That kicks in to preserve capital when something unexpected (by me) happens.

I've seen the biggest returns come from scale in all out style in trend context, no doubt. However that scale in all out needs to be very carefully applied as it can build an unreasonably large position, which is no fun to be stopped out with.

 

[natureboy]

I'll be honest, i don't like this trade. But my news-momo-pattern approach says take it. The method may only be 40% accurate, when it hits a winner though, it pays to let the thing work out..

And since i don't know the future, that means sitting through trades that 'appear' to be less than what i want..

 

[natureboy]

Volatility increase and near 50% A-D retracement increases odds for a trend..

I've also got the Dukascopy FX app, shows volume, which spiked at Dukas around 105 with some downside price action. All these things raise my confidence in the trade, i guess 5hrs of sleep makes me more bitter than usual.

once 62% of AD reached, i'll be more comfortable trailing the exit. I'm trailing it now, i'm just not comfortable yet.

 

[natureboy]

Trailing ext is at 1.2938, so about breakeven for me.

 

[natureboy]

The ADR(5) has 102 pips 'likely' daily range, which from the high at D (if that turns out to be the high for the session), the low would be 1.2850 area.



...Still trailing 1.2934. in theory, i'd expect a trend until 4-ish.. doesn't always work that way.

 

[natureboy]

Think of what these pattern tools can do for your trading. You'll be the big man in your firm. Your personal trading will have a new, real, edge from which you have the chance to make lots of money over and over again. Now i need a sexy lady to read that to you guys..

 

[natureboy]

We'll plan that for Friday. I have just the girl in mind.

 

[natureboy]

Sorry, really off topic. 1.2928 on the trailing exit, holding for 1.2850 area, i'll exit probably 1.2865, somewhere if the rate can get down there..

the whole thing could still mercilessly reverse. Its always important to control how much you lose when it doesn't work, i'm wrong.