Monday, April 12, 2010
Saturday, April 10, 2010
Tuesday, April 6, 2010
April 6 2010 AUD/JPY AUD interest rate report
Friday, April 2, 2010
April 2 2010 -NFP
Just wanted to post an important trade (but dangerous) the NFP (Non Farm Payroll) report, it appears every first Friday of every month. I'll create a post explaining the NFP in greater detail at a later time.
I woke up this morning around 7:30 AM EST. The NFP usually gets released around 8:30 AM barring any leaks, By going to the economic calender the night before I was able to look at the forecast and deduce that there were positive expectations for the US Dollar. So with this in mind I went over my technical analysis of the EUR/USD currency pair which at the time was near the high of an upswing (upswing in this pair signals EURO buying or Dollar selling). I noticed this on a 4 hour chart along with a daily chart, as a matter of fact I actually shorted the Euro the previous day and still had a few lots remaining for a 2nd & third target.
The previous day shot up to the height of the 4 hour upswing channel in anticipation of the NFP report the following day. The market was hitting that resistance plus going through a correction in anticipation. Because of the importance of this report it is normal to expect a wipsaw, you must gauge it based on experience, once that report comes out you have to digest the actual figures and make your move before or right after the wipsaw (I prefer after), but sometimes I live dangerously, yah baby yah!!!
Well I decided not to live dangerously, I actually didn't make a trade at all because I already made a trade the day before which is going in the same direction as my short term analysis. So now I can just watch it unfold. The numbers came out with a little lower than expected figures, just slightly though. If the numbers had came out on point I would have estimated a 60 PIP wipsaw, but instead there was only a 36 PIP wipsaw, 30 minutes afterward I was up 52 PIPs from the height of the wipsaw, 41 minutes after the report I was up 70 PIPs, by 4 PM I was still up almost 85 PIPs from the wipsaw.
This was from a single lot left from a previous trade, if you add the original entry from the day before that lot had gained almost 110 PIPs since the day before, I traded 10 lots to begin and took profit on 7 after 20 PIPs, took profit on 2 more lots after 40 PIPs and I'm still up 110 PIPs on the last lot:
20 x 7 lots = 140
40 x 2 lots = 80
110 x 1 lot = 110
------------------
total = 330 PIPs
I won't tell you what leverage I currently use by here's a grid to tease you on the possibilities:
Leverage x 330 Pips
$.10 x 330 = $33
$1 x 330 = $330
$10 x 330 = $3,300
$100 x 330 = $33,000
$1k x 330 = $330,000
$10k x 330 = $3.3 Million
$100k x 330 = $33 Million
I plan on starting a hedge fund some day I'm no pro at hedging yet but I have the concept down pact and I'll share some basics on it in time. Here's the MS PAINT screenshot of the NFP trade on a 5 minute chart, notice the bulk of activity was complete in almost 30 minutes, how's that for a day's work?
Basics - Normal Working hours
The forex markets on TV claim 24 hour activity, they are lairs, like many brokers they stretch the truth to make things sound good or easy. Your time zone plays a major role in your trading strategy. If you reside in the U.S. you'll find the best times to trade are when you are asleep, scary but I'll show you how to combat that issue in time.
Forex markets run from Sunday 5 PM till Friday 5 PM EST.
This gives you much of the weekend to do other things like prepare for the following week of trading, just kidding... but not really. You'll need to put forth a lot of time and energy into learning the basics, I promise afterward you can almost run on autopilot.
If you have a regular 9 to 5 (and I hope you do if you need money today) then you'll need to incorporate how to adjust your habits & schedule to fit market activities. Unless you plan on not sleeping you'll need to succumb to the market's needs. Don't try to force the market to work on your time, you'll lose and lose bad! Patience, it'll help relieve stress, when you first start off staring at a screen for hours on end you'll need every once of it. Consider having quite a bit of growing pains.
The biggest reason for adhering to the market's schedule is liquidity which is the forex version of stock market volume, but you can't really measure volume in forex, that's a topic for much later.
Forex markets run from Sunday 5 PM till Friday 5 PM EST.
This gives you much of the weekend to do other things like prepare for the following week of trading, just kidding... but not really. You'll need to put forth a lot of time and energy into learning the basics, I promise afterward you can almost run on autopilot.
If you have a regular 9 to 5 (and I hope you do if you need money today) then you'll need to incorporate how to adjust your habits & schedule to fit market activities. Unless you plan on not sleeping you'll need to succumb to the market's needs. Don't try to force the market to work on your time, you'll lose and lose bad! Patience, it'll help relieve stress, when you first start off staring at a screen for hours on end you'll need every once of it. Consider having quite a bit of growing pains.
The biggest reason for adhering to the market's schedule is liquidity which is the forex version of stock market volume, but you can't really measure volume in forex, that's a topic for much later.
My Pipping introduction
To My readers,
First I'd like to welcome you all while thanking you for being here! Did that sound crazy when you read it? It can come off as a bit complicated or get read and digested into a format that's better understood to the individual. Ok I'll need you to go back over that sentence and read it, then accept it for what it says, not your own interpretation of what it "should" mean.
Let's call it practice to ensure we are always clear on what's being said or happening, you'll learn in this business th slightest misunderstanding or interpretation can result in unnecessary financial losses. Oh and I'm not legally responsible for any financial decisions you make based on my blog, I'm not "telling" you what you should do, so know now and forever your decision is your own decision. And to be quite honest I'm doing this pro-bono until I decide to make my expertise strictly private.
A little background on myself, and I'm sure I'll be adding much more about who I am and my other activities as the blog goes on, I'm a computer engineer by trade. However during the course of my work history I've become a jack of all trades in the technology industry, at one point immersing myself into any and every technology I could get my hands on. Yes I was a hacker, I won't state whether I was an ethical hacker or not... but I did take the ethical courses and they taught me how to be unethical just as much as ethical. It's a concept I would like everyone to wrap their heads around, understanding how things work on both sides of the fence is essential to knowing how to advance using either approach.
Trading requires discipline, maybe now my military training will be put to good use. It also requires great attention to detail. If you understand concepts you will do well, if you understand concepts and pay great attention to detail, you will succeed! I've pretty much garnered all types of materials to learn about the financial markets over the last few years. I can't expect people in general to put forth the time and resources to develop the skill I have thus far so to shorten the learning curve I'll be training those who follow the blog leveraging current technology. Don't get all wound up and bent out of shape if your not in tune with technology or savvy at certain things, I'll simplify them for you, I assure you this will be "Pipping made easy"!
Shameless plug I know, I know, I had to do it, it was just tooooo easy!
First I'd like to welcome you all while thanking you for being here! Did that sound crazy when you read it? It can come off as a bit complicated or get read and digested into a format that's better understood to the individual. Ok I'll need you to go back over that sentence and read it, then accept it for what it says, not your own interpretation of what it "should" mean.
Let's call it practice to ensure we are always clear on what's being said or happening, you'll learn in this business th slightest misunderstanding or interpretation can result in unnecessary financial losses. Oh and I'm not legally responsible for any financial decisions you make based on my blog, I'm not "telling" you what you should do, so know now and forever your decision is your own decision. And to be quite honest I'm doing this pro-bono until I decide to make my expertise strictly private.
A little background on myself, and I'm sure I'll be adding much more about who I am and my other activities as the blog goes on, I'm a computer engineer by trade. However during the course of my work history I've become a jack of all trades in the technology industry, at one point immersing myself into any and every technology I could get my hands on. Yes I was a hacker, I won't state whether I was an ethical hacker or not... but I did take the ethical courses and they taught me how to be unethical just as much as ethical. It's a concept I would like everyone to wrap their heads around, understanding how things work on both sides of the fence is essential to knowing how to advance using either approach.
Trading requires discipline, maybe now my military training will be put to good use. It also requires great attention to detail. If you understand concepts you will do well, if you understand concepts and pay great attention to detail, you will succeed! I've pretty much garnered all types of materials to learn about the financial markets over the last few years. I can't expect people in general to put forth the time and resources to develop the skill I have thus far so to shorten the learning curve I'll be training those who follow the blog leveraging current technology. Don't get all wound up and bent out of shape if your not in tune with technology or savvy at certain things, I'll simplify them for you, I assure you this will be "Pipping made easy"!
Shameless plug I know, I know, I had to do it, it was just tooooo easy!
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