Sunday, November 15, 2009
Moving On…
Hi guys.
So it seems that my work and study life is catching up on me again. I will still be trading Forex but will not be updating this site too frequently, if not at all.
There are several Forex trading styles but all have their disadvantages. For long-term trading, stability is there, but then it is often quite hard to find the right time to take profit, fearing that the market will go faster our way, and if we were to hold on to the trade, we would have obtained even more. Short-term trading like swings or scalping will let us take out the cash that we profit but then these types of trades are more vulnerable to random market noise compared to long-term position trading.
With that said, I still think that I have not found my optimum trading style and I need to finish up work and college. So I will not be updating this Forex Journal much. But for now, you guys can enjoy the ajax forex charts:
Monday, July 27, 2009
EURAUD Long Candlestick!
July 27 2009. A funny and bizarre day. EURAUD showed strange movements. EURO was going down a bit. And then it was going down and down and then the candlesticks showed some rejection. Bulls were starting to win and I thought it was not going to beat the secondary support from far away.
Later on, a massive super long bear candle appeared.
Very strange and bizarre but it was on the 11th hour and the drop was sharp. Was it a market event? Well I am too lazy to check. But this drop won me 100 pips. Hehe.
Wednesday, July 15, 2009
USDCAD Breakout
USDCAD is currently having a breakout! It was rising but then it slowed down. And it was counter-trending for many days, but now it is July 15, 2009 and wham. Let’s see. Canada has been experiencing a downtime for the whole of last month but things cleared up and everything seems OK and stable. Then USD started fluctuating again and that explains the counter-trend.
This can be related with the spring effect. When you press a spring hard between your fingers, it will start to compress and store inertia energy until it can take no more and then when you release, it the spring makes a big jump! And it seems like USDCAD jumped downward. July 14 was about a decrease of 200 pips. Wow.
Thursday, July 9, 2009
RSI - A Big Help in Trend Trading
Recently, I have been paying a lot of attention to a simple but powerful indicator - the RSI, also known as the Relative Strength Index. This indicator shows you whether the current trend of the market is powerful or not.
As you may already know, trading ranging markets maybe dangerous although profitable. But most of the time, only those very experienced and full-time traders can successfully trade ranging markets. People like me who go to college and have other commitments cannot continuously watch the markets to scrap pips from the ranging markets and therefore, prefer to trade during trends.
But the problem is to find out whether the trend is strong enough to trade. I find that the SMA 21 indicator can help a lot, but the RSI is simply easier and faster to use. My system for using the RSI is simple. I just see what the RSI value is, on a daily chart (D1). If it is 60 and above, the market is going up. Below 40, it is going down. In between, I won’t trade. So I just take a glance at the RSI figure and if it starts with a 4 or 5, I will skip to the next pair. Trading when RSI is at the extremes - in my case above 60 or below 40 - greatly increases winning probability.
Thursday, June 25, 2009
Complete Reversal?
Final days of June 2009. A month ago, USD and JPY were plunging down. They were easy pickings for easy profits. You can just buy GBPUSD or GBPJPY just to profit instantly. But this month, not anymore.
It seems that a complete reversal pattern is imminent here. Great Britain Pound, Canadian Dollars and Australian Dollars, the 3 bullish currencies, look like they are taking a big turn. They are showing more days of bearish candlesticks, especially Canadian Dollars.
USD and Japanese Yen are pushing the charts and are breaking their downtrends. The question is whether it is a temporary big retracement and they will continue to drop after that, or it is a true reversal and the two underdogs are finally making a comeback.