Libertarian wrote:Ok long day today typing on iPhone so bear with me. Zls you like, then zlines it’ll be. Some questions. What pairs do you trade and what hours? Are strictly a day trader? More to come.
Btw, so if I am reading your chart right you held a long position as the news came out and totally obliterated your stop (no pun intended)?
Hi Leoheart, I trade the majors mostly, plus EJ, GJ, EN. Thats pretty much it.
I daytrade or swing, however long the position tells me to stay in. However, Ideally I'd like to learn to scalp a little bit more. If I could sleep and do this, that would be amazing.
You are correct, It gapped down 70 pips as the rate announcement happened. I'm a classically trained space trader so I used to set position beyond a distant extreme, however I'm trying to transition to trading lines, and in that vein I failed. Its happened to me twice now in a month and part of being an FX trader.
I am an extremely profitable trader.
PS. I have recorded that statement on my phone, I need a day to figure out how to get it to play on a loop. So I have to put that goal off 1 day.
I am no scalper, so sorry not much help there. When I am day trading, I try to enter when price picks up momentum,hold, and try my best to exit at an extreme.
As we are on the topic momo & zlines, This is how I see it:
On smaller TFs (no lower than 30 min or 1hr, prefer 30) Say we are on 30. I use just this chart. I do not run an MTF analysis. It Personally gives me a headache switching back and forth and causes me to add value to where it may not exist.
Now to counter this, I grab some highly correlated pairs and treat them as one pair. So in your scenario itd be:
1. EU, EJ
So you have 3 groups, but in your view its still only 3 pairs. You observing each pair , but the PA ultimately has to feel similar at the end. If EU is closing higher then EJ should at be atleast testing the lows. You still want to keep an eye on what the higher TF candle looks like. So on your chart (30 in this example) you only focus on the last 4 candles (2hr) plus the current open candle. So our focus is a total of 5 candles off the daily extreme.
All you are looking for is a simple momo burst candle up (ie buy) , the following candle should pierce the momo candle's body and close with a wick. No need to get overally technical with how far the wick should go within the momo candle. Now just confirm if your correlated pair has a similar view. Is it closing higher? Perhaps with momo? Enter the trade long. Three simple steps:
1. Am I atleast 5 candles within the daily extreme?
2. Do I see momo and then a wick?
3. Does my brother (sister) pair agrees with me?
Ok so thats the easy part. Now to the hard stuff.
Your risk: Say you are risking 2% a trade. What you want do is split up this risk in half, so only enter with 1%. Your stop is no more than 15 pips -20 pips. No reason in my view to have any larger on a intraday chart with a wick supporting your direction. As you enter the trade you are acknowledging that price may completely destroy your stop hence the half the risk is put on the line. If price does do this, then at your stop out level place a counter trade of 1% to go in the other direction. This gives atleast one more chance to recover from a loss. Hey If the price is being stubborn and reverse takes you out again, then you have still only lost 2% , your originally intended risk.
Take profit, I simply try to exist at ZZ extreme or look for lower candle closes against my position.