A cluster of stops all the way to 1.6218 on GBPUSD

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rolska
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Postby rolska » Tue Jul 07, 2009 10:34 am

Interesting posts
I took the GBPJPY trade in my demo account and sold more at the top. Nice trade, but it hit 1,5530 before it tanked.
You are obviously not a retail trader. At what level would you consider that trade wrong (SL)?
Could you explain more about the correlation with dax30? I don't see the benefit unless dax30 is ahead of the FX market.
Keep posting

Rolf

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EURUSD hit loads of stops on the way to 1.4037

Postby Paul » Tue Jul 07, 2009 11:50 am

EURUSD hit loads of stops on the way to 1.4037.
EURUSD neared lots of stops and it was clear that hitting them would open
the door to 1.4037.

At around 1.3930 some big action took place (stops and fresh aggressive buying). Longs needed to be tested and we needed to see their strength at 1.3930 to trust this direction. The test for longs was positive of course. It does
not mean that once 1.4037 is broken EURUSD is bound to shoot higher immediately. I wanted to show that until now this has been just a hunt for stops and it worked really very well. Handsome profits booked, no need to worry about the rest of the trading day.

The current situation has weakened shorts but I see that general public was unable to follow longs and longs are not very strong either. To do that they need another opportunity to go long, so these levels are not very comfortable for the job.
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To Rolf

Postby Paul » Tue Jul 07, 2009 12:36 pm

I wrote about an alignment of some elements, in this dax30, to explain price action of EURUSD.
An alignment is not a succession of events. They are rather happening at the same time, or almost at the same time. Do not look for clues on dax30, concentrate on FX. But you may check up from time to time what is going on on stock futures when sth goes the other way on FX. Treat dax30 as an auxiliary tool.

At what level would you consider that trade wrong (SL)?

From the perspective of a retailer the answer is simple and the SL will be defined by the rules well known to everybody. You know all the variables and the risk management. It is a very individual thing after all.

From the perspective of a non-retailer the answer is very complex and though it may seem insane, a distant stop looks very often like no stop at all (it may go well beyond the current short term chart levels). It does not matter what floating P/L each and every position shows right now, it matters what is the aggregate. So placing stops the way retailers do would not make any sense, no sense whatsoever.

Some light you may get from tremendous losses incurred by big names here and there and you may wonder how come thousands of positions on the market and all of them open for quite a long time and not a trace of a stop.

From the mathematical point of view a retailer is always a gambler, a wholesaler is an investor. If You place one order you bet, if you place many orders you invest. 1 lot is gambling, ten 0.1 lots is less gambling, more investment.

Suppose every day you get a sample of signals from a well defined method/strategy and you do not take all of them as they come but you select them and choose only few or just one. It is probable that you may always pick a bad thing which will not work and bring a loss.

A wholesaler raises the rate of success by using a big sample, ways bigger than a retailer and may win even if he is continuously wrong. A retailer may be a loser even if he is always right.


And finally when I write SHORT GBPJPY @ blabla and above means be prepared to open more than one position rather than just one (bingo).[I]

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Stops hit on GBPUSD and GBPJPY

Postby Paul » Tue Jul 07, 2009 11:41 pm

Stops hit on GBPUSD below big figure 1.6100 and GBPJPY below 153.40.

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SELLs seen at 1.3941 on eurusd

Postby Paul » Tue Jul 07, 2009 11:45 pm

Strong SELLs seen at 1.3941 on eurusd. Aren't they brave? Watch their defence strategy. Meantime eurusd dipped below big figure 1.3900. Dax30 went down yesterday quite a lot.
Yen is =up, global stocks came into play.

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A next significant target for GBPUSD is 1.5343

Postby Paul » Tue Jul 07, 2009 11:58 pm

A next significant target for GBPUSD is 1.5343. Isn't it far away from now? No.

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noone22
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Re: to noone22

Postby noone22 » Wed Jul 08, 2009 12:39 am

Paul wrote:A correlation is not a permanent phenomenon, however. Detailed studies are shown in Russian forex journals (free access)


It's still not clear, what is the fundamental (or other) reason
behind correlation of futures with Forex.

But even if correlation exists, what will be the rules (or tips - at least)
to make some profit from this correlation?
What is driving: DAX or Forex?
What to do, if ... ?

By the way, could you give exact URL for Russian forex journals
(I can read Russian).

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to noone22

Postby Paul » Wed Jul 08, 2009 6:35 am

http://fortrader.ru/
Russians deserve big respect the way they contribute to the development of an FX mind and the art of trading.

Now you continue to stick to the dax30 clue. Unless you can quickly assess what is going on there, there is no point in analyzing indices with an aim to implement your findings in FX. I was talking about an alignment of forces/energy. To explain to myself why sth is not going in the direction of the
massed orders (when you expect a bounce for example but it does not materialize).

Yesterday I had a buy signal on Dax30 but a sell signal on CAC40 in exactly the same place. Why? Because Dax30 chart has an error on H1 charts. This is one of those errors which can cost you a fortune. In a seemingly well regulated world of finances
cheating like that goes unpunished.
Last edited by Paul on Wed Jul 08, 2009 6:56 am, edited 1 time in total.

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Strong SELLs seen at 1.3941 on eurusd. Aren't they brave?

Postby Paul » Wed Jul 08, 2009 6:46 am

Strong SELLs seen at 1.3941 on eurusd. Aren't they brave? Watch their defence strategy. Eurusd dipped below big figure 1.3900 hitting more stops.
More SELLs near 1.3915. But 1.3941 should be tested back again like USDCHF should test 1.0870.
Dax30 went down yesterday quite a lot and started the new day from a slump.
Yen is =up, global stocks came into play.

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Postby ***FX-JEDI*** » Wed Jul 08, 2009 6:57 am

Hi Paul,

I enjoy reading your posts, I see the level you are talking about on GBP 1.5346, I posted a few screen shots of how I technically see GBP. what do you think, I know price can do generally anything, but I think this is what may happen on way down to level you stated.
I think I'm doing something right tho, did 3 trades last nite, & got 78.30 pips on GBP/JYP then in again for 121.99 pips on same, & another 84.39 on USD/JYP for total 284.68pips. I'm loving this market.
what is your thoughts on Fib levels?

Regards ***FX-JEDI***
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