[DbPhoenix]

Originally Posted by ant »

I thought I'd provide my perspective on trading as well...

If you're still around, klainey, I hope you study this post carefully and translate it into a series of specific actions.

It's not about platforms or systems or books or courses or seminars or CDs or DVDs or workshops or even being mentored, unless it's exactly the right person, which will be unlikely. It's about understanding how markets work, particularly auction markets. Why price moves at all, much less in a way from which you might profit. What traders are doing to move price, and how aggressively -- or not -- they're doing it. And where they're doing it. Which brings us to support and resistance.

Most traders wouldn't know support and resistance if they fell over it and broke both their legs. They don't understand what it is, so they find it in peculiar places that too often lead them either to the conclusion that their method of finding support and resistance works, even though it's entirely irrelevant to actual support and resistance, or to the conclusion that support and resistance "doesn't work" and is a lot of hooey.

The unfortunate fact is that most beginners have no idea what they're looking at. Many of them never will, either because they're not intelligent enough, or they don't work hard enough, or, oddly, they don't care. They don't much care, for example, why price is reversing. They only want an indicator or pattern that will tell them that price is reversing. They may even have marginal success in finding one that will work. For a while. In a marginal way. But not in a way that they have complete confidence in. Not in a way that will enable them to make a living trading.

So if you're in it for consistent profits, much less to earn a living, forego the short cuts. Learn what it's all about. Take your time. Study the charts. Watch price. Don't do anything about it or even wonder what you would do about it if you were to do anything about it. Just watch it. Study it. Learn to understand it. Eventually you'll learn how to play it for profit.

[thalestrader]

Originally Posted by thalestrader »

I'll leave you with two charts - the EURUSD and the 6E. I just took these screen shots as I am finishing typing this. A buy stop would go just above the blue line, and the stop loss goes just below the red dotted line. Will it trigger? I do not know. If it does trigger, will it be profitable? I do not know. But that is how I would trade the 6E if I were trading it right now (which I am not). That is how my daughter would be trading ithe EURUSD if she were trading right now (and she is not).

The point is this: Win or lose, if it triggers, it is an excellent trade. An excellent trade, win or lose.

Best Wishes,

Thales

Following up on the potential EURUSD trade posted last night, using the natural stopping points the market gave us, the final result would have been a marginally profitable trade for approximately 10 +/- ticks (in at 1.3955 and out at 1.3965). Not a wildly profitable trade, by any means, but a surprising number of such trades will result in the 50-100 tick profit.

I have included a screen shot of the GBPUSD which shows what I mean: A sell stop would have gotten a trader short at 1.6366, and using a natural stop method, the trade would currently be +120 ticks open trade equity, with a stop loss that would capture approximately +90 ticks.

These opportunities occur far more often than most realize.

And each can be identified in real time, before hand, with entry orders entered well in advance of the trade, and all without the use of volume, better volume, fractals, fibs, Ganns, squares, magic, market profile, worrying about your "competitors" and what "they" are doing, and with no understanding of what "fundamentals" are behind the move, not knowing whether price is moving on rising volume or falling volume, no need for "permission" from "indicators" (one of the silliest things traders say is that they "had permission from my stochastics" to take a trade, or "I would have taken that trade but my MACD didn't give me permission" - You should trade to be free, not to be enslaved to a mathematical equation). You do not need to use phrases like market structure or market flow, and I admit I have no idea and nor do I care to know what folks mean when they speak of "market context." You do not need to buy CD's or DVD's or subscribe to a chat room or trading room or a mentor or load your bookshelves with high priced priced text books.


Identify the immediate trend of the market, and trade accordingly.

Do that and win or lose, if it triggers, it is an excellent trade. An excellent trade, win or lose.

Best Wishes,

Thales

[BlowFish]

Originally Posted by thalestrader »

I've been working with my daughter, who wants to learn to trade as a summer project.

Wish I had had you as a parent Wish I could interest my son to the level that he would want to follow through.

[BlowFish]

OP if you are still round you should really read and digest the two nominated posts. If you can get to the point where you might actually believe them you will be on your way.

[Dinerotrader]

Thanks everyone for all the useful posting. It is threads like this that make TL so valuable for the beginning traders who are looking to get started in the right direction. I read postings from this forum for about 6 hours a day right now (day-job is slow) because I consistently find pockets of great information that help me to build a wide base of wisdom from those that have been on this path for a while. Thanks and keep up the great posts.
All the best.

[thalestrader]

One way to start trading is to identify a potential opportunity and trade it.

This mess from the EURJPY sure looks to me as though it should resolve to the downside. However, looking at current price action, it is a long trade opportunity that looks most likely.

I took two shots - one with a wider stop and one with a relatively close stop. I'm not real comfortable with that close stop - as I said, PA on this pair has been a mess today.

At any rate, I'd have a buy stop at 134.29 (I see that I have typed 134.35 as the buy stop on the chart - that is incorrect. I'd correct it now but I have to run. Sorry about that error).

Best Wishes,

Thales

[Dinerotrader]

How much weight do you give to chart patterns in your analysis? I noted on this chart what looks like a pretty good set up to go short on but I don't have a good feel for chart patterns yet.

[thalestrader]

Originally Posted by imorgan »

How much weight do you give to chart patterns in your analysis? I noted on this chart what looks like a pretty good set up to go short

I agree. In my post above, I said the following:

Originally Posted by thalestrader »

This mess from the EURJPY sure looks to me as though it should resolve to the downside.

I've attached a 15 minute chart, where I note the same formation you outlined. I would right now be long from 133.29, and it now looks as though that stop loss at 133.11 would be the right place to exit the position if price does retrace that far.

As to chart patterns, I use particular chart patterns support trading decisions once the pattern completes.

As in this case, however, I would not allow a developing but incomplete pattern to prevent me from taking a trade opposite that which the chart pattern suggests.

I would still be comfortable staying long here with a stop at 133.11, even though I'd be 15 ticks in the red at the moment. Actual HH's and HL's have to trump the mere potential for LH's and LL's.

Best Wishes,

Thales